Which of the following statements regarding stock options is false?
A) Options are valuable because the executives can gain the benefits of stock price increases without bearing the risks of price declines.
B) Options are generally given to corporate officers as a form of incentive compensation.
C) Stock options are rights granted to executives to purchase a specific number of shares of a corporation's capital stock at a specific price for a specific time period.
D) Measurement of the value of stock options is simply the market value of the options at the balance sheet date.
E) Footnotes in the financial statements must reveal the number and type of options outstanding and an assessment of their value.
Correct Answer:
Verified
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