Stock Compensation Flashcards
What does FASB 718-10-30 require enterprises to use when it comes to stock options and other equity plans for officers/employees?
Fair Value Method
How is Intrinsic Value Method Calculated?
Excess of Market Price over Exercise Price
What are non-compensatory stock purchase plans
Plans that allow the employee to purchase company stock but is not treated as compensation expense
What are the requirements of Non-Compensatory stock purchase plans
Full time employees meeting limited employment may qualify
Plan enrollment of option/purchase must not exceed 31 days
Discount of the market price is reasonable
When is compensation cost allocated?
Allocated to the periods which the employee performs the related services
What are the Journal Entries to accrue compensation expense?
DR Compensation Expense
CR APIC-Stock Options
Same entry over a few periods
What are the journal entries to exercise options?
DR Cash
DR APIC-Stock Options
CR Common Stock
CR Capital in Excess of Par - Common
When is total compensation cost determined?
Determined at the Date of Grant
In a Compensatory stock option plan the grant, vesting and exercise dates are all different. APIC-Stock Options should be reduced at what date?
Exercise Date
What method uses the date of grant to measure stock costs issued to employees?
Intrinsic Value Method & Fair Market Value Method
