xercise 19-2 ock options; rfeiture of tions On January 1, 2016, MEM Corporation granted 75,000 incentive stock options to branch managers, each permitting holders to purchase one share of the company's $1 par common shares within the next 7 years, but not before December 31, 2020 (the vesting date). The exercise price is the market price of the shares on the date of grant, currently $20 per share. The fair value of the options, estimated by an appropriate option pricing model, is $7 per option. Required: 1. Determine the total compensation cost pertaining to the options on January 1,2016. 019-2 xt: E 19-6 to record compensation expense on December 31, 3. Unexpected turnover during 2017 caused the forfeiture of 10% of the stock options. Determine 2016. the adjusted compensation cost, and prepare the appropriate journal entry(s) on December 31, 2017. xercise 19-3 s: treasury ck; new shares; ck dividends o years The Reserve Company had 606 million shares of common stock outstanding at January 1, 2016. The following activities affected common shares during the year: There are no potential common shares outstanding 2016 Feb. 27 Purchased 18 million shares of treasury stock. 19-5 LO19-6 Oct. 30 Sold the treasury shares purchased on February 27. Nov. 29 Issued 72 million new shares. t: E 19-13 Dec. 31 Net income for 2016 is $1,200 million. 2017 Declared and issued a 2 for 1 stock split. Net income for 2017 is $1,200 million. Jan. 14 Dec. 31 Required: 1. Determine the 2016 EPS 2. Determine the 2017 EPS 3. At what amount will the 2016 EPS be presented in the 2017 comparative financial statements