On January 1, 2015, Sixty Executives Are Offered a Fixed

question 67

Essay

On January 1, 2015, sixty executives are offered a fixed compensatory stock option plan in which each of them will receive options to buy 5,000 shares of $10 par common stock at $30 a share. On the grant date, the fair value per option is $7.50. There is a three-year service period and an estimated annual employee turnover rate of 3%.
Required:
a.Compute the expected total compensation cost.
b.Compute the compensation expense for 2011.
c.Prepare the journal entry to record the exercise of options by six of the executives on January 1, 2018.

Identify the impacts of European explorers on indigenous populations in the Americas.

Comprehend the role of centralized government in the development and administration of early cities.

Recognize the cultural and historical significance of ancient cities and heritage sites.

Understand the genetic factors and diseases prevalent in specific populations and their historical significance.

---

Definitions:

Overhead Variances

The difference between actual overhead costs and the budgeted or standard overhead costs.

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to products or job orders, calculated before the costs are actually incurred.

Labor-Hour

A unit of measure representing one hour of work by an employee, often used in costing and budgeting processes.

Variable Overhead Efficiency Variance

The difference between the actual variable overhead incurred and the standard variable overhead allocated, based on the actual input of the allocation base.