Refer to the most recent 10-K for Apple Inc (2017) and Alphabet Inc. (2016) : (a

Question

Refer to the most recent 10-K for Apple Inc (2017) and Alphabet Inc. (2016):

(a)          What employee stock compensation plans are offered by Apple and Alphabet (plan name and type of awards)? (2 points)

(b)          How many RSUs are outstanding (unvested) at year-end for both Apple and Alphabet? (2 points)

(c)           How many RSUs were granted by Apple and Alphabet during the most recent fiscal year? (2 points)

(d)          What is the unrecognized compensation costs related to stock based compensation for Apple and Alphabet during the most recent fiscal year? Over what period will this compensation be recognized (if given)? (4 points)

Alphabet 10K: https://www.sec.gov/Archives/edgar/data/1652044/000165204417000008/goog10-kq42016.htm

Apple: https://www.sec.gov/Archives/edgar/data/320193/000032019317000070/a10-k20179302017.htm

Explanation / Answer

Answer a)

Apple:

The Employee Stock Purchase Plan (the “Purchase Plan”) is a shareholder approved plan under which substantially all employees may purchase the Company’s common stock through payroll deductions at a price equal to 85% of the lower of the fair market values of the stock as of the beginning or the end of six-month offering periods. An employee’s payroll deductions under the Purchase Plan are limited to 10% of the employee’s compensation and employees may not purchase more than $25,000 of stock during any calendar year. As of September 30, 2017, approximately 41.5 million shares were reserved for future issuance under the Purchase Plan.

Alphabet:

Stock-based compensation includes restricted stock units (RSUs) that will be settled in Alphabet stock as well as awards which was expect to ultimately settle in cash.

Answer b)

Apple:

The fair value of RSUs was $6.1 billion. The total shares withheld were approximately 15.4 million

Alphabet:

RSUs are measured at the fair market value of the underlying stock at the grant date. Liability classified awards are measured at fair value through settlement. As of December 31, 2016, there were 26,206,647 shares of stock reserved for future issuance under Stock Plan.

Alphabet:

Stock-based compensation includes restricted stock units (RSUs) that will be settled in Alphabet stock as well as awards which was expect to ultimately settle in cash.

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