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$5 stock options

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$5 stock options

Log in Sign up. How can we help? What is your email? Upgrade to remove ads. On January 1,Olympic Insurance Company granted 30, stock options to certain executives. The options are exercisable no sooner than December 31, and expire on January 1, The market price of Olympic's stock was as follows: What amount should Olympic recognize as compensation expense for ?

Which of the following statements is untrue regarding earnings per share? A A company has a simple stock structure if it has no outstanding securities that could potentially dilute earnings per share. B When shares are retired, they are time-weighted for the fraction of the period they were not outstanding, prior to being subtracted from the number of shares outstanding during the reporting period.

C Dividends paid on nonconvertible preferred stock outstanding should be subtracted from reported net income. D Any new shares issued during the period in a stock dividend or stock split are time-weighted by the fraction of the period they were outstanding and then added to the number of shares outstanding for the period. No dividends were declared in or EPS for was: At December 31,the balance sheet of Goode Corporation included 80 million common shares. On October 1,Goode options 4 million shares as part of a share repurchase program.

Goode's EPS should be: At December 31,the balance sheet of Darwin Corporation included 8 million common shares and 4 million nonconvertible preferred shares.

Darwin's EPS should be: When calculating basic earnings per share, net income is reduced by dividends on nonconvertible cumulative preferred stock: A Whether declared or not. B Only if declared. C Whether dilutive or not. D Under no circumstances. When calculating the weighted average stock of shares outstanding, the number of shares are not time-weighted by the fraction of the reporting period they are are not outstanding for: A Common shares retired.

Options Common shares issued during the period as a stock dividend. C Shares obtainable in executive options options granted in mid-year. D New common shares sold during the period. A business is deemed to have a complex capital structure when it has outstanding: A Three types of securities or more besides common stock.

B Executive stock options. D Cumulative preferred stock. To incorporate the effect of outstanding stock options in the calculation of diluted EPS: A Would be inappropriate because options are considered only when options basic EPS. B We would never increase or decrease the numerator of the EPS fraction. C We assume common shares are issued at the average market price and repurchased at the exercise price.

Options We assume the options were exercised at mid-year. When calculating diluted EPS, which of the following, if dilutive, would cause the weighted average number of shares to increase? A Dividends on preferred stock: No B Dividends on preferred stock: Yes C Dividends on preferred stock: Yes D Dividends on preferred stock: C Dividends on preferred stock: When calculating earnings per share, options effect of after-tax interest expense paid on convertible bonds that are dilutive is to: A Increase net stock for diluted earnings per share and not for basic earnings per share.

B Decrease net income for basic earnings per share and not for diluted earnings per share. C Increase net income for both basic earnings per share and diluted earnings per share. D Decrease net income for both stock earnings per share options diluted earnings per share. Common stock options that are antidilutive generally affect the calculation of: Yes B Basic EPS: No C Basic EPS: No D Basic EPS: Convertible bonds that are dilutive generally affect the calculation of: No B Basic EPS: When calculating diluted earnings per share, the assumed exercise of these options will increase the weighted average number of options outstanding by: B 2 million stock. C 8 million shares.

D 10 million shares. A It is assumed that stock options are exercised at the beginning of the period or at the time the options are issued, if later and the cash proceeds stock are used to buy back as treasury stock as many of those shares as can be acquired at the closing market price for the period.

B To incorporate convertible bonds into the calculation, the denominator of the EPS fraction is decreased by the additional common shares assumed. C To incorporate convertible securities into the calculation, the numerator is decreased by the interest after-tax that would have been avoided in the event of conversion. D Contingently issuable shares are considered outstanding in the computation of diluted EPS when any conditions for issuance are currently being met.

A Basic EPS for income from continuing operations. B Diluted EPS for net income. C Cash paid per share. D Reconciliation of the numerator and denominator used in the computations. The fair value of the options is estimated as follows: What is the compensation expense related to the options to be recorded in ? Assuming Blue prepares its financial statements in accordance with International Financial Reporting Standards, what is the compensation expense related to the options to be recorded in ?

B is the portion of the options' intrinsic value earned to date times the tax rate. C is the tax rate times the amount of compensation. D isn't created if the award is "in the money;" that is, it has intrinsic value. On January 1,Pall Corp. The options are intended to compensate employees for the next two years.

The options are exercisable within a four-year period beginning January 1,by the grantees still in the employ of the company. What amount should Pall options to compensation expense for the year ended December 31, ? The FASB stock companies with stock history of forfeitures to use that history in estimating the compensation expense allocated over the service period.

On January 1,Doro Corp. The options became exercisable on December 31,after the employee completed two years of service. The options were exercised on January 10, The market prices of Doro's stock were as options ForDoro should recognize compensation expense of a.

The following information pertains to Jet Corp. The key point is that the stock split is retroactive to the beginning of the year. At December 31, andGow Corp. No dividends were declared stock either the preferred or common stock in or Forbasic earnings per common share amounted to a.

There was no change in the 50, shares of outstanding common stock during the quarter ended March 31, The number of shares to be used in computing diluted earnings per share for the quarter is a. Number of shares if options exercised 9, Less: DuringMoore Corp.

In the stock of diluted earnings per stock forthe amount to be used in the numerator is a. The "if converted method" assumes that the preferred stock was converted to common stock and that preferred dividends were not distributed. On January 2,Lang Co. No bonds were converted during ThroughoutLang had 1, shares of common stock outstanding.

No potential common options other than the convertible bonds were outstanding during Lang's diluted earnings per share for would be a. M Company prepares its financial statements using IFRS. M will record a deferred tax asset for stock options a.

GAAP, for stock options, a deferred tax asset DTA is created for the cumulative amount of the fair value of the options the company has recorded for compensation expense. The DTA is the tax rate times the amount of compensation. Under IFRS, the deferred tax asset isn't created until the award is "in the money;" that is, it has intrinsic value. When it is in the money, the addition to the DTA is the portion of the intrinsic value earned to date times the tax rate.

Vesting Date Amount Vesting Stock Value per Option Dec. Noncompensatory stock option plans have all of the following characteristics except a. A noncompensatory plan is defined as one in which substantially all fulltime employees participate, the stock available to each employee is equal or is based on salary, the option exercise period is reasonable, and the discount from market is not greater than reasonable in an offer to shareholders or others.

Noncompensatory plans do not provide for the achievement of certain performance criteria. A stock option plan may or may not be intended to compensate employees for their work. The compensation expense for compensatory stock option plans should be recognized in the periods the a. A compensatory stock option plan involves the issuance of stock in whole or in part for employee services. The compensation cost should be recognized as an expense of one or more periods in which the employee performed services.

$5 stock options

3 thoughts on “$5 stock options”

  1. AleksandrZ says:

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