SOLVED

6) O’Neil Manufacturing issued 200,000 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. O’Neil’s management estimates the value of these options at the grant date to be $1.75 each. Required: Record the issuance of the stock options. 7) 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. 8) Price Farms granted 290,000 stock options to its employees. The options expire 45 years after the grant date of January 1, 2016, when the share price was $23. Employees still employed by Price five years after the grant date may exercise the option to purchase shares at $45 each; that is, the options vest to the employees after five years. A consultant estimated the value of each option at the date of grant to be $1.50 each. Required: Record the journal entries relating to the issuance of stock options. 9) Princeton Inc. granted 290,000 stock options to its employees. The options expire 45 years after the grant date of January 1, 2016, when the share price was $23. Employees still employed by the company four years after the grant date may exercise the option to purchase shares at $45 each; that is, the options vest to the employees after five years. A consultant estimated the value of each option at the date of grant to be $2.50 each. Required: Record the journal entries relating to the issuance of stock options. 10) AnnuG Inc. granted 200,000 stock options to its employees. The options expire 45 years after the grant date of January 1, 2015, when the share price was $23. Employees still employed by the company six years after the grant date may exercise the option to purchase shares at $45 each; that is, the options vest to the employees after five years. A consultant estimated the value of each option at the date of grant to be $2.50 each. Required: Record the journal entries relating to the issuance of stock options.