Nadal Company has 20 executives to whom it grants compensatory share options on January 1, 2016. At that time, it grants each executive the right to purchase 100 shares of its $5 par common stock at $39 per share after a 3-year service period. The value of each option is estimated to be $8.50 on the grant date. Based on its average employee turnover rate each year, Nadal expects that 2 executives will not vest in the plan. At the end of 2018, Nadal confirms that the actual turnover was the same as expected. On January 5, 2019, 3 executives exercise their options.
Required:
Prepare general journal Nadal’s memorandum entry on the grant date and journal entries for 2016 through 2019 in regard to its compensatory share option plan. |
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