Chat with us, powered by LiveChat On January 1, 2012, Guaymas Company established a - Writemia

On January 1, 2012, Guaymas Company established a

On January 1, 2012, Guaymas Company established a stock option plan for its senior employees. A total of 550,000 options were granted that permit employees to purchase 550,000 shares of stock at $23 per share. Each option had a fair value of $6 on the grant date. The market price for Guaymas stock on January 1, 2012, was $23. The employees are required to remain with Guaymas for four years (2012, 2013, 2014, and 2015) in order to be able to exercise these options. Guaymas’ net income for 2012, before including any consideration of compensation expense, is $870,000.Required:1. Compute the compensation expense associated with these options for 2012 under the fair value method. Note that the period of time that the employees must work to be able to exercise the options is four years.2. Interpretive Question: You are a Guaymas stockholder. What objections might you have to Guaymas’ employee stock option plan?

Do you need an answer to this or any other questions?

About Writemia

We are a professional paper writing website. If you have searched a question and bumped into our website just know you are in the right place to get help in your coursework. We offer HIGH QUALITY & PLAGIARISM FREE Papers.

How It Works

To make an Order you only need to click on “Place Order” and we will direct you to our Order Page. Fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.

Are there Discounts?

All new clients are eligible for 20% off in their first Order. Our payment method is safe and secure.

Hire a tutor today CLICK HERE to make your first order