On january 2, 2014 sanders corporation granted stock options to key employees for the purchase of 60,000 shares of the company's common stock at $25 per share. the options are intended to compensate employees for the next two years (service period). the options are exercisable within a four year period beginning january 1, 2016, by grantees still in employ of the company (exercise period). the fair value of the option determined by an option pricing model is $7 at the grant date. how much should sanders charge to compensation expense for the year ended december 31, 2014? assume that no stock options were terminated during the year.

Joint cost cheyenne, inc. produces three products from a common input. the joint costs for a typical quarter follow: direct materials $45,000 direct labor 55,000 overhead 60,000 the revenues from each product are as follows: product a $75,000 product b 80,000 product c 30,000 management is considering processing product a beyond the split-off point, which would increase the sales value of product a to $116,000. however, to process product a further means that the company must rent some special equipment costing $17,500 per quarter. additional materials and labor also needed would cost $12,650 per quarter. a. what is the gross profit currently being earned by the three products for one quarter? $answer b. what is the effect on quarterly profits if the company decides to process product a further? $answer