On January 1, 2017, Bubert Corporation issues 12,500 shares of $2 par restricted stock to its key executives. The market value of unrestricted shares of the same stock on the date of issue is $19 and there is a four-year vesting period. What is the amount of compensation expense recorded on December 31, 2017?

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The correct answer is A. The amount of compensation expense recorded on December 31, 2017 is $59,375. This is calculated as follows:Fair value of unrestricted shares on date of issue: $19 per shareNumber of shares issued: 12,500 sharesTotal fair value of unrestricted shares: $19 x 12,500 = $237,500Vesting period: 4 yearsCompensation expense per year: $237,500 / 4 = $59,375

On January 1, 2017, Bubert Corporation Issues 12,500 Shares of $2