#1. Pastner Brands is a calendar-year firm with operations in


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Apr 14, 2015. See 1.docx Need help solving the attached questions. For example, solving for compensation expense for stock options,  Computing Dow’s earnings per share and Renn-Dever’s earnings per share.  Please help by showing steps. ATTACHMENT PREVIEW Download attachment 1.docx #1. Pastner Brands is a calendar-year firm with operations in several countries. As part of its executive compensation plan, at January 1, 2013, the company issued 520,000 executive stock options permitting executives to buy 520,000 shares of Pastner stock for $40 per share. One-fourth of the options vest in each of the next four years beginning at December 31, 2013 (graded vesting). Pastner elects to separate the total award into four groups (or tranches) according to the year in which they vest and measures the compensation cost for each vesting date as a separate award. The fair value of each tranche is estimated at January 1, 2013, as follows: Vesting Date Amount Vesting Dec. 31, 2013 25% Dec. 31, 2014 25% Dec. 31, 2015 25% Dec. 31, 2016 25% Fair Value per Option 4.1 $ 0 4.6 $ 0 5.1 $ 0 5.6 $ 0 Required: 1. Determine the compensation expense related to the options to be recorded each year 2013–2016, assuming Pastner allocates the compensation cost for each of the four groups (tranches) separately. Shares Vesting at: Dec. 31, 2013 Dec. 31, 2014 Dec. 31, 2015 Dec. 31, 2016 Compensation Expen 2013 Total 2. Determine the compensation expense related to the options to be recorded each year 2013–2016, assuming Pastner uses the straight-line method to allocate the total compensation cost. 2013 Compensation expense 2014 2015 2016 Total #2. On December 31, 2012, Dow Steel Corporation had 710,000 shares of common stock and 41,000 shares of 7%, noncumulative, nonconvertible preferred stock issued and outstanding. Dow issued a 4% common stock dividend on May 15 and paid cash dividends of $510,000 and $80,000 to common and preferred shareholders, respectively, on December 15, 2013. On February 28, 2013, Dow sold 63,000 common shares. In keeping with its long-term share repurchase plan, 4,000 shares were retired on July 1. Dow’s net income for the year ended December 31, 2013, was $2,650,000. The income tax rate is 40%. Required: Compute Dow’s earnings per share for the year ended December 31, 2013. (Do not round intermediate calculations. Round your answer to 2 decimal places.) #3. Comparative Statements of Retained Earnings for Renn-Dever Corporation were reported as follows for the fiscal years ending December 31, 2011, 2012, and 2013. Read more Mar-mar-binx
posted a question · Apr 14, 2015 at 4:24am

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