journal entries for employee stock options 566735

Journal entries for employee stock options. Morrissey Corporation grants 50,000 stock options to its managerial employees on December 31, 2008, to purchase 50,000 shares of its $1 par value common stock for $60 per share. The market price of a share of common stock on this dare in $50 per share. Employees must wait two years before the options vest and they can exercise the options, and this two year period is the expected period of benefit from the stock options. An option pricing model indicates that the value of these options on the grant date is $400,000. On June 30, 2011, holders of 30,000 options exercise their options at a time when the market price of the stock is $65 per share. On November 15, 2011, holders of the remaining options exercise them at a time when the market price of the stock is $72 per share.