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JMR CorpGrants Their Top Executive an Option for 1,000 Shares

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Essay

JMR Corp.grants their top executive an option for 1,000 shares.The option price is $30 per share.Prepare the journal entry if the current market price is $40 per share.What would happen if instead the market price was $25?


Definitions:

Creditors

Individuals, businesses, or entities to whom money is owed by debtors, typically due to the provision of goods, services, or loans.

Cash Flow

The complete spectrum of financial inflow and outflow in a business, vitally affecting its liquidity.

Stockholders

Individuals or entities that own shares in a corporation, giving them certain rights like voting on corporate affairs.

Tax Rate

The chunk of financial earnings a corporation or individual pays as tax.

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