How to Record Stock Options on a Balance Sheet

Record the periodic cost allocation of the stock option. The periodic cost is the value of the stock options divided by the number of service years. Record a journal entry that debits 'compensation expense' (this expense is reported in the income statement) and credits 'additional paid in capital -- stock options' (a stockholder's equity account reported in the balance sheet). Record this cost annually throughout the employee's vesting period.
Record the exercise of the stock option. When the exercise date arrives, the employee can exercise the option and purchase the company's common stock at the exercise price. Common stock is valued at par, a designated dollar amount used to value each share of common stock on the balance sheet. When common stock is sold or repurchased, it is usually for a price above the par value, so the excess amount over par is credited to an 'additional paid in capital' account. The journal entry to record the exercise of the option involves debiting 'cash' for the number of shares purchased multiplied by the exercise price. In addition, debit 'additional paid in capital -- stock options' for the balance accumulated in the account over the vesting period and credit 'common stock' for the number of shares purchased multiplied by the stock's par value. The remaining credit is made to 'additional paid-in capital in excess of par (common stock)' for the amount needed to balance the journal entry.
Record the expiration of the options, if applicable. If a stock option is not exercised on its exercise date, it will expire or sometimes only some of the shares offered by the option are purchased. If the options expire, the balance in the 'additional paid in capital -- stock options' account needs to be transferred to 'additional paid in capital -- expired stock options' account. By debiting the stock options account and crediting the expired stock options account, the cost is reclassified within the stockholder's equity section of the balance sheet. When a portion of the option shares are exercised and a portion expire, allocate the costs as explained in steps 2 and 3 based on the number of shares purchased and the remaining value of the option that expired.

How to Buy Minimum/Small Amounts of Stock

Review your current checking, savings and other bank accounts. Compare this to outstanding debt that you owe and determine the amount of money that have readily available to invest in the stock market. This is an important first step because the amount you can invest will help determine where and what type of stock trading account you can open.
Research online stock trading accounts to determine which one will suit your own needs best. Pay attention to minimum opening deposits that they require and note trading fees and also if there are minimum per transaction requirements. For example, some online trading firms require a minimum amount to open an account, while others do not. There is also a wide range in terms of what each firm charges per transaction or trade. Make a note of all of the options and decide which one suits your needs best.
Open an online trading account. Online trading accounts have much lower fees in comparison to using a traditional stockbroker, which is more in line with small and minimal stock purchases. As of July 2010, online trading accounts had fees for buying and selling stock as low as $4 per transaction. Some online trading accounts offer the first trades free which is also a good incentive for an investor only looking to buy a minimal amount of stock.
Treat your small stock investment account the same as you would any other investment. Review your account balances at least once per month to make sure that the money you have spent on stocks is providing you with a return on your money that you are comfortable with.
Continue to buy and sell stock in small amounts and fund your account with additional money when you are able to. Even those buying small amounts of stock occasionally can build a nice-sized portfolio over time.

How to Trade Stock Futures (5 Steps)

Learn the mechanics of how to trade stock futures. Stock futures are traded as standardized contracts of 100 shares. They are issued for a specified time period and expire on the third Friday of their final month. At that point they must be settled. This means you must buy (or sell) the actual shares unless you have an offsetting option contract (see Step 5). The attraction of stock futures lies in the fact that they can be traded on margin, allowing investors to leverage trades and increase potential profits.
Open a margin account with a brokerage firm. Trading accounts with margin privileges are similar to regular (cash) brokerage accounts, except that you are allowed to borrow money or stock from the broker. Because you buy a futures contract instead of the stock, there are no interest charges. However, this is considered a margin transaction because your potential liability is greater than the money you put up as a margin requirement. A margin account typically requires a $2,000 minimum balance, although for day traders this may be as high as $25,000.
Place an order to for a call (buy) or put (sell) futures contract with your broker. SEC regulations require a 20 percent margin. For example, if you purchase a contract for a stock selling at $25 a share, you must put up $5 a share or $500. If the stock goes up by $5 a share you make $500---a 100 percent profit, instead of the 20 percent you would make by buying the stock itself.
Keep up with daily fluctuations in the market price of the stock. The risk when you trade stock futures is as great as the potential profit. If the stock falls in price (or rises for a put futures contract) your investment decreases quickly and you will get a margin call. For example (using the example from step 3), if the stock falls from $25 to $23 a share, your margin falls to $3 a share, or 13 percent of the share price. You must then add more funds or the broker has to close out the account. Since small changes in price have such a large effect, you need to monitor the stock on a daily basis, if not more often.
Close out the transaction when you are ready. Very few stock futures contracts are actually exercised (that is, the underlying shares purchased and delivered). Instead, trades are normally settled by purchasing a second futures contract of the opposite type (a put if you are holding a call and vice versa). The two contracts simply cancel each other out at expiration.

How to Invest in Rice on the Stock Market

Open a brokerage account that will allow you to trade futures, options and stocks (see Resources below for suggestions).
Buy an options or futures contract on rice. The ticker symbol for rice is ZR. You will need a minimum margin of $2,430 for a futures contract and $250 for an options contract.
Enter the ticker symbol into the brokerage software and click on 'Search.' This will bring up a list of rice-related products and their contract dates.
Select the month of the contract that you wish to purchase and the price that you wish to buy it at under the “Limit” price. Click on “Buy” or “Submit Order.” When the price of the contract is reached, the software will automatically purchase the contract.



Buy a stock or exchange traded fund (ETF). Since rice producers are not publicly traded companies you cannot purchase their stock directly. You can, however, buy the stock of companies related to the production of rice.
Buy stock from companies that make pesticides and seed-related products related to rice. You can research these types of companies at MarketWatch.com or Morningstar.com.
Buy an exchange traded fund (ETF). These are funds that invest in several different, but related companies for diversification. There are several agricultural ETFs that you can consider. These include the ELEMENTS Rogers International Commodity fund (NYSE: RJA), the iPath DJ AIG Agriculture Fund (NYSE: JJA) and the PowerShares DB Agriculture ETF (NYSE: DBA).

How to Open a Stock Market Account

Select an online stock broker. It is important to compare stock commissions, other fees and the services the broker provides through their website. Changing brokers can cost $100 or more, so this is an important step. The Smart Money broker 2009 Broker survey is linked below. The top three rated brokers in the survey were E-Trade, Fidelity and Charles Schwab.
Apply online for an account with the selected stock broker. The online application process will take about 10 minutes and you will receive instant approval and an account number. Stock brokers are required to collect employment information to comply with Securities and Exchange Commission rules.
Fund your brokerage account. Money can be sent to a stock broker account by wire transfer, electronic ACH transfer or by sending a check. Wire transfer is the fastest but has fees on both ends. It takes three to four days to set up an ACH transfer. Once set up, ACH is an easy way to move money in and out of your stock account.
Familiarize yourself with the broker's stock order screen and place trades for the stocks you want to own. Stock purchases are done by designating the number of shares. A market order will be filled at the current price. If you want to buy or sell at a specific price, use a limit order.

How to Buy Stock Without a Broker

Find an online trading company. There are many online trading companies that allow you to set up and trade stocks online. You may be familiar with some of these companies and new ones are popping up over time. Some of the companies you can look into include E-Trade, TD Ameritrade and Charles Schwab. Whichever companies you look into, you should research them completely. Be sure to find out what the fees are for setting up and maintaining the account, as well as the per trade fee charged.
Set up and fund your account. Once you have researched each company and make a decision on which company you want to trade online, it is time to set up and fund your trading account. Each website will have step-by-step instructions on what you need to do to set up your account. Once the account is set up, you will need to either mail in a check or transfer money into the account to fund your online trading account. Funding an online trading account is placing the money in the account that you will use to make trades.
Research the stocks you want to invest in. Most of these online trading sites also provide research material so you can educate yourself on the stocks and bonds you may be interested in buying. You should do a lot of research on any stock before you decide to invest your money in the stock. These sites also help you to understand finance and trading terminology that you may be familiar with. It is important that you make informed and educated decisions to help reduce the risk of loss of your money.
Process the buy or sell trade. Once you decide to buy a stock, you will need to process the order. Every site is slightly differently, but each site usually has line-by-line buy 'forms' that you need to complete and submit in order to process the trade. This is true whether you are buying or selling a stock.

How to Give Direct Purchase Stock Shares as Christmas Gifts

Choose the stock you'd like to buy. Whether you want to buy a big money stock or just one that fits well with the recipient's personality, the easiest way to start is to find direct purchase stocks (or DPPs) online. Not all companies sell their stock in this fashion, but there are hundreds of companies that do. One good place to find a list is at sharebuilder.com.
Set up an online trading account. It is possible to contact the company directly but much easier to set up an account with Sharebuilder, eTrade or a similar clearinghouse, especially if you plan to buy stock from more than one company. Simply go the respective website and register. There will be step by step instructions to help you.
Purchase the stock. Once you're signed into your account, there should be instructions on how to make your purchases. It will basically be the same process you use to buy other goods and services over the Internet. However additional steps may be required to verify your identity.
Transfer the stock to the recipient's name. Remember, you want the recipient to be able to sell his or her stock, so you should not leave it in your name. All you need to do is tell the company that sold you the shares that you would like to make a transfer. You can either call the customer service number or look for 'shareholder services' or a similar link on their website to make contact electronically. Be prepared to provide the name, Social Security number and birth date for the new owner.
Once you've transferred stock into the name of the recipient, ask the company to send you a paper certificate. This is what you will wrap up and give as the gift. Feel free to frame it or package it as you see fit. Some certificates look better on the wall than others. For example, DreamWorks stock has a picture of Shrek on the front of it, which is perfect for a child's bedroom.

How to Buy Direct Stock Without a Broker (4 Steps)

Find out if a company you are interested in offers a direct stock purchase plan. Companies offering DSPPs feature them in the Investor Relations section of their websites. Alternatively, you can check transfer agent companies like ComputerShare and Sharebuilder, who have lists of the companies for which they manage DSPPs on their websites.
Open an account with the company's transfer agent. You can either call the transfer agent and request a paper application or apply online. There is a one time fee to set up a DSPP to buy direct stock without a broker that ranges from $10 to $25, depending on the stock. The minimum investment is usually $250 or $500.
Arrange to have monthly investments automatically deducted from your checking or savings account. You can make your investments by check. However, if you use electronic funds transfer the transaction fees are lower--just $1 to $3 per transaction, pus 3 to 5 cents per share. Another advantage of using electronic debiting is that you can meet the minimum investment requirement with monthly installments of $50. Once you have invested the minimum you can add more when you wish, as long as additional investments are at least $50 each. Some companies, like Exxon Mobil, even pay the transaction fees for stock purchases so all of your money goes directly towards purchasing stock.
Choose the plan features that suit your needs. Most DSPPs provide free dividend reinvestment and safekeeping storage of your stock certificates. You can set up a direct stock purchase plan as an Individual Retirement Account (IRA). Some companies add special features. For example, McDonald's has a program in which a minor can start a direct stock purchase plan for their stock for as little as $100.

How to Buy Exxon Mobil Stock Direct (7 Steps)

Download copies of the Exxon Mobile DSPP brochure and enrollment form from ComputerShare.com. You may also request copies by calling ComputerShare at (800) 252-1800.
Read the brochure, which discloses the terms of the Exxon Mobil direct stock-purchase program.
Decide if you want to sign up for automatic debiting from your checking or savings account to make the required $250 initial investment in five installments of $50 per month.
Choose the plan features you want. You can reinvest dividends at no charge or have them paid to you. You may set up the plan as a traditional or Roth IRA or a Coverdell Educational Savings Account.
Complete the enrollment form. Provide your Social Security number and contact information. Include your bank-account information on the attached authorization form if you want to set up automatic debiting.
Fill out and attach a W8-BEN form, available from ComputerShare, if you are opening the DSPP as a custodial account for a child.
Mail the enrollment form with a check or money order for your initial investment--or first month's installment if you chose automatic investing--to the address on the form.

How to Begin Stock Market Trading (3 Steps)

Select an online brokerage company. There are many online stock brokers to choose from (three of the biggest are included in the links below). Be sure to compare the fees and minimum account requirements of each in making your selection.
Set up and fund your account. Most online brokerage houses will have your new account up and running in a matter of minutes. You will need to transfer funds from a checking or savings account to start investing; many brokerages can do this via ACH or EFT transfers.
Start researching the market. There are a host of resources to learn about stock trading. Start by reading the resources that your online broker gives you on their website, then branch out and do some research on your own.