The Rustic Knot Entity, a purveyor of green technologies, offers its executives a stock option package that vests after 500 hours of community service. Not all stock option packages are expected to vest. How should this be accounted for?
A) As a service condition, excluding those options not expected to vest
B) As a performance condition, excluding those options not expected to vest
C) As a service condition, including those options not expected to vest
D) As a performance condition, including those options not expected to vest
E) None of the above

Question

Quizplus · Accepted Answer

The requirement of 500 hours of community service is a service condition, and options not expected to vest should be excluded from the accounting.

The Rustic Knot Entity, a Purveyor of Green Technologies, Offers