McMillan Manufacturing Issued 60,000 Stock Options to Its Employees

question 75

Essay

McMillan Manufacturing issued 60,000 stock options to its employees. The company granted the stock options at-the-money, when the share price was $40. These options have no vesting conditions. By year-end, the share price had increased to $42. McMillan's management estimates the value of these options at the grant date to be $1.10 each.
Required:
Record the issuance of the stock options.

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Definitions:

Labour Markets

The supply and demand for labour, where employees provide the labour and employers provide the jobs, influenced by various economic factors.

Technical Ladder

A career path within an organization that allows employees to advance in their technical skills and expertise without necessarily moving into management positions.

Design Engineers

Professionals who apply engineering principles to design products, systems, or processes, focusing on functionality, cost-effectiveness, and manufacturability.

Compensation System

A structured approach by employers to determine the pay and benefits of employees, including wages, salaries, bonuses, and commissions.