(Stock-Appreciation Rights) On December 31, 2010, Beckford Company issues 150,000 stock- appreciation rights to its officers entitling them to receive cash for the difference between the market price of its stock and a pre-established price of $10. The fair value of the SARs is estimated to be $4 per SAR on December 31, 2011; $1 on December 31, 2012; $10 on December 31, 2013; and $9 on December 31, 2014. The service period is 4 years, and the exercise period is 7 years.
(a) Prepare a schedule that shows the amount of compensation expense allocable to each year affected by the stock-appreciation rights plan.
(b) P r epa r e the entry at December 31, 2014, to r eco r d compensation expense, if an y , in 2014.
(c) P r epa r e the entry on December 31, 2014, assuming that all 150,000 SARs a r e exe r cised.