Regarding employee stock options, which of the following is/are true?
a. Firms compute a fair-value-based measure of employee stock options on the date of the grant using an option-pricing model that incorporates information about the current market price, the exercise price, the expected time between grant and exercise, the expected volatility of the stock, the expected dividends, and the risk-free interest rate.
b. Total compensation cost is the number of options the firm expects to vest times the expected value per option at the date of redemption.
c. Firms amortize this total cost over the requisite service period, which is the expected period of benefit.
d. The requisite service period is usually the period between the grant date and the vesting date.
e. Firms do not typically remeasure most types of stock options after the initial grant date.
B
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The accountant failed to make the adjusting entry to record the amount of interest owed on a note to the bank at the end of the year. This error would cause an overstatement of
A) assets. B) expenses. C) liabilities. D) shareholders' equity.
Identify the account below that is classified as a liability account:
A. Accounts Payable B. Cash C. Equipment D. Salaries Expense E. Retained Earnings
Experienced Capital Company and First Street Bank are secured parties with security interests in property owned by Grande Oil Corporation. Between these security interests, the first to be filed or perfected has priority over other filed or perfected security interests in
A. most circumstances. B. no circumstances. C. states that have not adopted Article 9 of the UCC. D. states that require a security agreement to be signed and dated by the creditor.
Explain the meaning of the following ethics traps: rationalization, conformity, following orders, lost in a crowd, and blind spots