On January 2, 2015, Stoner Corporation granted stock options to key employees for the purchase...

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Accounting

On January 2, 2015, Stoner Corporation granted stock options to key employees for the purchase of 125,000 shares of the company's common stock ($10 Par) at $25 per share. The options are intended to compensate employees for the next two years. The fair value of an option (determined by an option pricing model) is $4 at the grant date.

a. Prepare the journal entry for the year ended December 31, 2015. Show all calculations!! b. Prepare the journal entry for February 1, 2017, when the stock options are exercised. The stock price on February 1, 2017 is $50. Show all calculations!!

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