Connect .> C Secure ! https://newconnect.mheducation.com/flow/connect.html Ch. 1

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Connect .> C Secure ! https://newconnect.mheducation.com/flow/connect.html Ch. 19 - Brief Exercises (80 minutes) Help Save & Exlt Submlt Saved 3 Check my work 2 Brief Exercise 19-2 Restricted stock units LO19-1] 6.25 points Second Link Services granted restricted stock units (RSUs) representing 12 million of its $1 par common shares to executives, subject to forfeiture if employment is terminated within four years. After the recipients of the RSUs satisfy the vesting requirement, the company will distribute the shares. The common shares had a market price of $24 per share on the grant date Sklpped 1. Ignoring taxes, what is the total compensation cost pertaining to the restricted stock units? (Enter your answer in millions (i.e. 10,000,000 should be entered as 10).) 2. Ignoring taxes, what is the effect on earnings in the year after the RSUs are granted to executives? (Enter your answer in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).) eBook References 1. Total compensation cost 2. Effect on earnings million million Mc Graw Hill ?Prey 2 or 16? Next > ???@) a e ^??4, 4/17/2018 8-32 PM |

Explanation / Answer

1 Total compensation cost = 12*24 = $288 million 2 Effect on earnings decreased by $72 million (288/4)

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