On january 1, 2018, vki corporation awarded restricted stock units (rsus) representing 19 million of its $1 par common shares to key personnel, subject to forfeiture if employment is terminated within three years. after the recipients of the rsus satisfy the vesting requirement, the company will distribute the shares. on the grant date, the shares had a market price of $5.10 per share. required:

1. determine the total compensation cost pertaining to the rsus. 2. to 6. prepare the appropriate journal entries.

1. Total compensation cost= $96.9 m

2. Compensation expense  $32.3 m

                       paid-in capital - restricted stock   $32.3m

Explanation:

The question relates to 'EQUITY GRANT', which is some sort of compensation given to somebody, especially/specifically to employees of an entity provided that certain conditions/vesting requirements are satisfied by the employee. For example, an entity in it's initial phases of growth (because certain entities don't have the money/working capital in initial stages of business) offers it's employees to stay within the entity for at least three years during which no stipend will be paid but shall receive equity ownership thereafter. In such a situation the employer grants them equity once the vesting requirement is satisfied by the employees.

So at the time of of awarding, no entry is passed with respect to RSUs but at each reporting date the entity records a certain amount in equity account. Total compensation cost is calculated as follows:

Total compensation cost = 19 m×$5.10

TCC= $96.8M

The RSUs are split into three year period as follows:

Yearly equity recognition: $96.9m÷3= $32.3m

So at 31 December 2018 VKI Corporation would charge $32.3m to the equity account. The entry is as follows:

Compensation expense  $32.3 m

                       paid-in capital - restricted stock   $32.3m

answer; i do believe that the correct answer is (6) points in georgia;

answer; operating revenues;