How high will Microsoft fly? Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : How high will Microsoft fly?

MSFT 507.49

-0.6%

3:59 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Valley Girl who wrote (41064)	4/4/2000 11:04:00 AM
From: Exacctnt	Read Replies (1) of 74651

<<<When an employee exercises a stock option, there is no actual cash effect on the company.>>> Actually, there is a cash effect from exercised options. The employee pays the company the the amount equal to the grant price times the number of shares issued. Also, the company doesn't usually ramp the printing press to issue new shares. In most cases, the shares are issued out of Treasury Stock. The Treasury Stock Account is stock that has been issued at one time and contains shares the company purchases from buyback programs. You are correct as far as the general effect on the income statement. That being a reduced effective income tax, generating more earnings. Somewhat offset by a dilution in earnings caused by issuing more shares.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next