ch16_sol

2011 no journal entry would be recorded at the time

• Notes
• 8
• 100% (16) 16 out of 16 people found this document helpful

This preview shows page 7 - 8 out of 8 pages.

2011 - No journal entry would be recorded at the time the stock option plan was adopted. However, a memorandum entry in the journal might be made on November 30, 2011, indicating that a stock option plan had authorized the future granting to officers of options to buy 70,000 shares of \$5.00 par value common stock at \$9.00 a share. (To record issuance of 20,000 shares of \$5 par value stock upon exercise of options at option price of \$9)

Subscribe to view the full document.

0eaa0a329e22b0a9ab0afeb0943e225b5f4c0e17.xlsx, Problem 16-3, Page 8 of 8, 03/29/2012, 01:32:15 Name: Date: Instructor: Course: provided that 70,000 shares of \$5.00 par value stock be designated as available for the granting of options to officers of the corporation at a price of \$9.00 a share. The market price was \$12.00 a share on November 30, 2012. On January 2, 2012, options to purchase 28,000 shares were granted to president Tom Winter - 15,000 for services rendered in 2012 and 13,000 for services to be rendered in 2013. Also on that date, options to purchase 14,000 shares were granted to vice president Michelle Bennett - 7,000 for services to be rendered in 2012 and 7,000 for services to be rendered in 2013. The market value of the stock was \$14 a share on January 2, 2012. The options were exercisable for a period of one year following the year in which the services were rendered. The fair value of the options on the grant date was \$4 per option. In 2013 neither the president nor the vice president exercised their options because the market price of the stock was below the exercise price. The market value of the stock was \$8 a share on December 31, 2013, when the options for 2012 services lapsed. On December 31, 2014, both president Winter and vice president Bennett exercised their options for 13,000 and 7,000 shares, respectively, when the market price was \$16 a share. Instructions: Enter text answer here. Jan 2, 12 Enter text answer as appropriate. Dec 31, 12 Account title Amount Account title Amount Dec 31, 13 Account Title Amount Account Title Amount Dec 31, 13 Account Title Amount Account Title Amount Dec 31, 14 Account Title Amount Account Title Amount Account Title Amount Account Title Amount Intermediate Accounting , 14 th Edition by Kieso, Weygandt, and Warfield Primer on Using Excel in Accounting by Rex A Schildhouse P16-3 (Stock-Option Plan) Berg Company adopted a stock-option plan on November 30, 2011, that Prepare the necessary journal entries in 2011 when the stock-option plan was adopted, in 2012 when options were granted, in 2013 when options lapsed, and in 2014 when options were exercised.
You've reached the end of this preview.
• Spring '12
• o
• Accounting, 1981, 1968, 1944, 1977

{[ snackBarMessage ]}

What students are saying

• As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

Kiran Temple University Fox School of Business ‘17, Course Hero Intern

• I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

Dana University of Pennsylvania ‘17, Course Hero Intern

• The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

Jill Tulane University ‘16, Course Hero Intern