P19-1 On October 15, 2012, the board of directors of Ensor Materials Corporation approved a stock option plan for key executives. On January 1, 2013, 20 million stock options were granted, exercisable for 20 million shares of Ensor’s $1 par common stock. The options are exercisable between January 1, 2016, and December 31, 2018, at 80% of the quoted market price on January 1, 2013, which was $15. The fair value of the 20 million options, estimated by an appropriate option pricing model, is $6 per option.
Two million options were forfeited when an executive resigned in 2014. All other options were exercised on July 12, 2017, when the stock’s price jumped unexpectedly to $19 per share.
1. When is Ensor’s stock option measurement date?
2. Determine the compensation expense for the stock option plan in 2013. (Ignore taxes.)
3. What is the effect of forfeiture of the stock options on Ensor’s financial statements for 2014 and 2015?
4. Is this effect consistent with the general approach for accounting for changes in estimates? Explain.
5. How should Ensor account for the exercise of the options in 2017? (Enter your answers in millions. Round your answers to the nearest dollar amount. Omit the “$” sign in your response.)
Try it now!
How it works?
Follow these simple steps to get your paper done
Place your order
Fill in the order form and provide all details of your assignment.
Proceed with the payment
Choose the payment system that suits you most.
Receive the final file
Once your paper is ready, we will email it to you.
Australia Assessments has gained an international reputation of being the leading website in custom assignment writing services. Once you give us the instructions of your paper through the order form, we will complete the rest.
As we work towards providing the best custom assignment services, our company provides assignment services for any type of academic essay. We will help you develop professionally written essays that are rich in content and free from plagiarism.
Admission and Business Papers
Our skilled team of professional writers will ensure that we help you craft a remarkable admission essay for your desired Master's program in your institution of choice. We won't stop there. Once you enter the job market, we will be available to secure you a position at your desired worksite by creating an outstanding portfolio or resume.
Editing and Proofreading
Our editorial team is always available for all editing and proofreading services. They check completed papers by our writers and also provide professional opinions to papers completed by our clients.
We harbor professional academic writers with different qualifications in diverse academic fields. As such, we are capable of handling both simple and technical papers. Ensure that you provide us with correct and complete instructions in the order form.