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On January 1, 2015 Carter Company granted a total of 10,000 stock options to 10...

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Accounting

On January 1, 2015 Carter Company granted a total of 10,000 stock options to 10 company officers. Each option can be used to purchase one share of the companys $1 par value common stock at $20 per share. The options are additional compensation for work to be performed over the next two years. They are exercisable during a 5-year period beginning on January 1, 2017. The Magic option-pricing model determines total compensation expense related to these options to be $90,000. The market price of the common stock was $21 per share at the date of grant.

At December 31, 2021, eight of the executives exercised their options and the remaining two chose to forfeit them. At that date, the market price of the common stock was $35 per share.

Record the journal entries required on January 1, 2015, December 31, 2015, December 31, 2016, and on December 31, 2021.

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