Common Stock Issued to Employees Through the Exercise of Stock

question 118

Multiple Choice

Common stock issued to employees through the exercise of stock warrants under a stock option plan that is classified as a noncompensatory stock option plan is recorded by the corporation at the

• A)market price of the stock
• B)option price of the stock
• C)market price of the stock at the first date that the warrant can be exercised
• D)option price of the stock plus the value assigned to the stock warrant

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Definitions:

Equal Distribution

The equitable allocation of resources, income, or assets among all members of a society or group.

Income

The total money received by an individual or household over a specified time period, including wages, salaries, benefits, and other earnings.

Positive Economic Statement

An objective statement based on facts that can be tested or validated, focusing on descriptions of what is rather than what ought to be.

Payroll Tax

Taxes imposed on employers or employees, and are usually calculated as a percentage of the salaries that employers pay their staff.