CFA Practice Question

There are 334 practice questions for this study session.

CFA Practice Question

Which options are exercised, according to SFAS 123, ______ should be debited and ______ should be credited.

I. cash
II. paid-in capital - stock options
III. compensation expense
IV. common stock (par)
V. paid in capital in excess of par
Correct Answer: debit I and II, and credit IV and V.

User Contributed Comments 3

User Comment
bmeisner How does this agree with the question earlier about debiting compensation expense?
ssradja you debit it when granted, not exercised as this question asks.
quanttrader when granted you credit paid-in capital (stock options), when exercised you debit paid-in capital and credit paid in capital in excess of par
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