Assuming a four-year vesting period, how much compensation expense did Facebook

Question

Assuming a four-year vesting period, how much compensation expense did Facebook report in the year ended December 31, 2014, for the restricted stock units granted during the year ended December 31, 2013?

Facebook Inc. included the following disclosure note in an annual report: Share-Based Compensation (in part) compensation expense related to these grants is based on the grant date fair value of the RSUs and is recognized on a straight-line basis over the applicable service period. The following table summarizes the activities for our unvested RSUs for the year ended December 31, 2013 Nurnbeer cf Shares (in thousands) Weighted Average Grant Date Fair Value 113,644 53,663 (47,850) (15,167) $21.44 30.71 17.02 25.37 Unvested at December 31, 2012 Grarnici Vested Forfeited Unvested at December 31, 2013 104,290 $27.60

Explanation / Answer

·         Compute the total expense reported by incorporation F for the year ended dec31, 2014

Compute the total compensation cost of RSUs for 4 year vesting period

Total compensation cost of RSUs = fair market value per share *number of shares awarded

=30.71*53,663,000

=1647990730

Expense allocated each year = total compensation cost of RSU/vesting period

=1677990730/4= 411,997,683 or 412 millions

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