Hammerstein Corporation offers a variety of share-based compensation plans to employees.Under its restricted stock award plan,the company,on January 1,2016,granted 2 million of its $1 par common shares to various division managers.The shares are subject to forfeiture if employment is terminated within four years.The common shares have a market price of $20 per share on the award date.
Required:
(1. )Determine the total compensation cost from these restricted shares.
(2. )Prepare the appropriate journal entry to record the award on January 1,2016.
(3. )Prepare the appropriate journal entry to record compensation expense on December 31,2016.
(4. )Suppose a 15% forfeiture rate was expected prior to vesting.Determine the total compensation cost,assuming the company follows the fair value approach and chooses to anticipate forfeitures at the grant date.

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The Answer of Hammerstein Corporation offers a variety of share-based compensation plans to employees.Under its restricted stock award plan,the company,on January 1,2016,granted 2 million of its $1 par common shares to various division managers.The shares are subject to forfeiture if employment is terminated within four years.The common shares have a market price of $20 per share on the award date.
Required:
(1. )Determine the total compensation cost from these restricted shares.
(2. )Prepare the appropriate journal entry to record the award on January 1,2016.
(3. )Prepare the appropriate journal entry to record compensation expense on December 31,2016.
(4. )Suppose a 15% forfeiture rate was expected prior to vesting.Determine the total compensation cost,assuming the company follows the fair value approach and chooses to anticipate forfeitures at the grant date.

Hammerstein Corporation Offers a Variety of Share-Based Compensation Plans to Employees.Under