assets, $ 120Expected and actual return, 10 %. Compute the reported postretirement benefit liability at year-end.
Question 10
The balance in the capitalized natural resources deposit account immediately before beginning removal operations is $ 110,000. The date is January 1 of the current( first) year. The firm is then informed that to comply with environmental regulations, the site will require reclamation work in four years costing an estimated $ 30,000 at that time. 5 % is the appropriate risk adjusted rate of return. One-fourth the total estimated resource in the site was removed in the first year and was sold for $ 70,000. Compute the increase in net income for the current year from operating the site. Ignore income taxes. The present value of $ 1 four years hence at 5 % is. 8227.
Question 11
A stock option award was granted at the beginning of the current year( 1 / 1 / x4) to three managers. The total shares granted are 30,000( 10,000 each). The option price and market price of the $ 2 par common stock on the grant date was $ 6. The options vest Dec. 31, 20x7. Applying an option pricing model yielded a fair value of $ 1 per option. Assume all of the options were exercised when the stock price was $ 10. What amount of compensation expense in total is recognized over the service period and by what amount is the firm ' s net assets increased as a result of the option award.
Question 12
Because management has been so successful, key executives were granted 1,000 stock appreciation rights at the beginning of 20x4 calling for the difference between the market price of the firm ' s stock at grant date and at exercise date to be paid in cash. The employees must work for 3 years after which the rights are exercisable. The market price at the beginning of 20x4 was $ 10, and on the exercise