Identifying and Analyzing Financial Statement Effects of Stock-Based Compensation The stockholders' equity of Aspen Corporation at December 31, 2019, follows. 7% Preferred stock $100 par value, 20,000 shares authorized: 4.000 shares issued and outstanding Common stock $15 par value. 300.000 shares authorized: 30.000 shares issued and outstanding $400,000 450.000 36,000 360,000 325,000 $1.571.000 Paid-in capital in excess of par value-preferred stock Paid-in capital in excess of par value-common stock Retained earnings Total stockholders equity The following transactions, among others, occurred during the following year. • Employees exercised 12,000 stock options that were granted in 2015 and had a three-year vesting period. These options had an estimated fair value of $2 at the grant date, and an exercise price of $16. There were no other vested or unvested options after this exercise. • Awarded 1,000 shares of stock to new executives, when the stock price was $36. • Sold 10,000 shares to employees under the company-wide stock purchase plan. Under the plan, employees purchased the shares at a 10% discount when the stock price was $33 per share. • Granted 40,000 new stock options, with a strike price of $34 and an estimated fair value of $6. The options vest over three years. Required Prepare the December 31, 2019, statement of stockholders' equity assuming that the company reports 2019 pretax income of $483,000 before the effects of stock-based compensation. Assume the company has a 35% tax rate.
Identifying and Analyzing Financial Statement Effects of Stock-Based Compensation The stockholders' equity of Aspen Corporation at December 31, 2019, follows. 7% Preferred stock $100 par value, 20,000 shares authorized: 4.000 shares issued and outstanding Common stock $15 par value. 300.000 shares authorized: 30.000 shares issued and outstanding $400,000 450.000 36,000 360,000 325,000 $1.571.000 Paid-in capital in excess of par value-preferred stock Paid-in capital in excess of par value-common stock Retained earnings Total stockholders equity The following transactions, among others, occurred during the following year. • Employees exercised 12,000 stock options that were granted in 2015 and had a three-year vesting period. These options had an estimated fair value of $2 at the grant date, and an exercise price of $16. There were no other vested or unvested options after this exercise. • Awarded 1,000 shares of stock to new executives, when the stock price was $36. • Sold 10,000 shares to employees under the company-wide stock purchase plan. Under the plan, employees purchased the shares at a 10% discount when the stock price was $33 per share. • Granted 40,000 new stock options, with a strike price of $34 and an estimated fair value of $6. The options vest over three years. Required Prepare the December 31, 2019, statement of stockholders' equity assuming that the company reports 2019 pretax income of $483,000 before the effects of stock-based compensation. Assume the company has a 35% tax rate.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter15: Contributed Capital
Section: Chapter Questions
Problem 16E: Contributed Capital Adams Companys records provide the following information on December 31, 2019:...
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