On January 1, 2018, ABC, Inc. initiated two compensation plans for its employees: · Granted 25,000 Stock Appreciation Rights (SARs) subject to forfeiture if the president leaves or is fired from the company before December 31, 2021. The company can choose to liquidate the commitment with shares only. · Granted 50,000 units of restricted common shares (RSUs) subject to forfeiture if the executive leaves or is fired from the company before December 31, 2021. The employee may elect to receive the cash instead of the shares at the time of exercising the units (RSUs). The market value of ABC's common stock was $ 5 on 1/1/18 and $ 7 on 12/31/18. ABC's common stock is worth $ 1 par. The fair value of the SARs on 1/1/18 was $ 5.5 and as of 12/31/18 it was $ 9. Yes or no: ABC Inc. will have to reevaluate as of 12/31/18 any debt related to these compensation plans in the event of Select one: to. Yes, in the case of SARs. b. None of the above. c. Yes, in the case of RSUs. d. Yes, both for SARs and RSUs.
On January 1, 2018, ABC, Inc. initiated two compensation plans for its employees: · Granted 25,000 Stock Appreciation Rights (SARs) subject to forfeiture if the president leaves or is fired from the company before December 31, 2021. The company can choose to liquidate the commitment with shares only. · Granted 50,000 units of restricted common shares (RSUs) subject to forfeiture if the executive leaves or is fired from the company before December 31, 2021. The employee may elect to receive the cash instead of the shares at the time of exercising the units (RSUs). The market value of ABC's common stock was $ 5 on 1/1/18 and $ 7 on 12/31/18. ABC's common stock is worth $ 1 par. The fair value of the SARs on 1/1/18 was $ 5.5 and as of 12/31/18 it was $ 9. Yes or no: ABC Inc. will have to reevaluate as of 12/31/18 any debt related to these compensation plans in the event of Select one: to. Yes, in the case of SARs. b. None of the above. c. Yes, in the case of RSUs. d. Yes, both for SARs and RSUs.
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