Fair value based method stock options



Mark To Market - MTM. The staff reminds registrants of the expected term disclosure requirements described in FASB ASC subparagraph f 2 i. Market quotes would be based on widely accepted valuation models. For stock options, fair methood is determined using an option-pricing model that takes into account the stock price at the grant date, the exercise price, the expected life of the option, the volatility of the underlying stock and the expected dividends on it, and the risk-free interest rate over the expected life ofthe option. In optipns, in this model, assigned values in some cases are below intrinsic value. Likewise for dividends used in the valuation.




What is your email? False Convertible bonds are usually converted into Common Stock When a bond issuer offers some form of additional consideration a "sweetener" to induce conversion, the sweetener is accounted for as a n Expense The conversion of preferred stock into common requires that any excess of the par value of the common shares issued over the carrying amount of the preferred being converted should be treated as a direct reduction of retained earnings Nondetachable warrants do not require an allocation of the proceeds between the bonds and the warrants.

True The conversion of preferred stock may be recorded by the Book value method The proceeds from the sale of debt with detachable stock warrants should be allocated between the two securities based on the: aggregate fair market value of the bonds and the warrants Disclosure for compensation plans should include weighted average fair value of options granted during the year. Which of the following is not one of the commonly used stock compensation plans?

Stock conversion plans Earnings per share is reported for both common and preferred stock. True In the diluted earnings per share computation, the treasury stock method is used for options and warrants to reflect assumed reacquisition of common stock at the average market price during the period. If the exercise price of the options or warrants exceeds the average market price, the computation would be antidilutive What will the numerator of the diluted EPS calculation consist of when convertible preferred stock is being included?

True If there are multiple potentially dilutive securities, the one that should be used first to recalculate earnings per share is the one that is least fair value based method stock options. False--the one that is most dilutive should be used first When a company has cumulative preferred stock outstanding, the preferred dividend is subtracted from fair value based method stock options income in the earnings per share calculation whether the dividend has been declared or not.

True All of the following statements are true regarding IFRS and their treatment of financial instruments, including dilutive securities, except: IFRS records combined bond issue's debt with equity components. True When convertible debt is retired: either a gain or a loss on retirement is recognized Detachable stock warrants outstanding should be classified as paid in capital The issuance of warrants arises under all of the following situations except to: give bondholders the preemptive right to purchase stock Compensation expense resulting from a compensatory stock option plan is generally allocated to the periods benefited by the employee's required service Under the fair-value method of recording stock options, companies will report a higher compensation cost relative to the intrinsic-value forex lawyer. Accounting for stock option plans must be based on: the fair value method What effect will the acquisition of treasury stock have on stockholders' equity and earnings per share, respectively?

Decrease and Increase Which earnings per share amounts are reported in a complex capital structure? Basic and Diluted EPS The diluted EPS computation considers all of the following except the impact of: antidilutive securities The treasury stock method of computing incremental shares applies to: stock options and warrants Complex capital structures require all of the following disclosures except: the effect of conversions before year end The measurement date for stock appreciation rights is the date of grant.

False If preferred stock is cumulative, and dividends have not been declared in the past two years or in the current year, what amount should be deducted from net income in the EPS calculation?




Stock Options (Issuing, Exercising & Expired Options, Compensation Expense, PIC Options)


ACCOUNTING FOR STOCK-BASED COMPENSATION . This Statement defines a fair value based method of Stock Options For stock options, fair value is. Compensation for Employee Stock Options: The options may vest based on the passage of time or for traditional employee stock options, the fair value method is. Expensing Stock Options: A Fair-Value arguing that grant-date estimates of the cost of employee stock options, based on Our proposed method involves creating.

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