Asked by Andres Soler on Jul 28, 2024
Verified
For a stock appreciation rights (SAR) compensation plan, the measurement date is the date
A) on which the options (SARs) are granted to the employees
B) when the employees may first exercise the options (SARs)
C) on which the options (SARs) are exercised
D) of the adoption of the plan
Stock Appreciation Rights
A type of bonus compensation given to employees that is equivalent to the appreciation (increase in value) of the company stock over a set period.
Compensation Plan
A detailed plan that outlines the salary, wages, benefits, and incentives for employees, designed to motivate and reward them.
Measurement Date
The specific date at which the values of assets and liabilities are determined in the preparation of financial statements.
- Understand the principles of stock appreciation rights (SARs) compensation plans and their measurement and exercise dates.
Verified Answer
CS
Catherine SidesJul 29, 2024
Final Answer :
C
Explanation :
The measurement date for a stock appreciation rights (SAR) compensation plan is the date on which the options (SARs) are exercised. This is because the SARs give the employee the right to receive the appreciation in the value of the company's stock from the grant date to the exercise date. Therefore, the measurement date is when the gain is realized by the employee.
Learning Objectives
- Understand the principles of stock appreciation rights (SARs) compensation plans and their measurement and exercise dates.