UFR- Assignment PDF

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Share BasedPaymentUse the following information for the next five (5) questions: On January 1, 2021, Cooler Company grants 100 cash share appreciation rights (SARs) to each of its 300 employees, on condition that the employees remain in its employ for the next three years. During 2021, 21 employees ...

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Share Based Payment Use the following information for the next five (5) questions: On January 1, 2021, Cooler Company grants 100 cash share appreciation rights (SARs) to each of its 300 employees, on condition that the employees remain in its employ for the next three years. During 2021, 21 employees left and Cooler estimates that additional 36 employees will leave during 2022 and 2023. During 2022, 24 employees left and Cooler estimates that additional 15 employees will leave during 2023. During 2023, 13 employees left. The SARs were exercised as follows: Date Number Of Employees Who Exercised Their SARS December 31, 2023 90 December 31, 2024 84 December 31, 2025 68 The fair values and intrinsic values of the SARs at the dates of exercise (which equal the cash paid out) at the end of 2013, 2024 and 2025 are shown below. Date Fair Value Of SARS Intrinsic Value December 31, 2021 57.60 December 31, 2022 62.00 December 31, 2023 72.80 60 December 31, 2024 85.60 80 December 31, 2025 100 1) How much is the salaries expense recognized in 2021? A. 466,560 B. 448,600

C.

446,560

D.

420,650

C.

929,000

D.

925,000

C.

638,460

D.

636,560

C.

(145,600)

D.

0

C.

94,920

D.

0

2) How much is the accrued liability as of December 31, 2022? A.

992,000

B.

932,000

3) How much is the salaries expense recognized in 2023? A. 769,760 B. 654,560 4) How much is the salaries expense recognized in 2024? A.

148,460

B.

147,520

5) How much is the salaries expense recognized in 2025? A. 98,420 B. 97,920

Use the following information for the next two (2) questions: At the beginning of Year 1, an entity grants to a senior executive 3,000 share options, conditional upon the executive remaining in the entity’s employ until the end of Year 3. The exercise price is P40. However, the exercise price drops to P30 if the entity’s earnings increase by at least an average of 10 percent per year over the three-year period. On grant date, the entity estimates that the fair value of the share options, with an exercise price of P30, is P15 per option. If the exercise price is P40, the entity estimates that the share options have a fair value of P12 per option. During year 1, the entity’s earnings increased by 12 percent, and the entity expects that earnings will continue to increase at this rate over the next two years. The entity therefore expects that the earnings target will be achieved, and hence the share options will have an exercise price of P30. During year 2, the entity’s earnings increased by 13 percent, and the entity continuous to expect that earnings target will be achieved. During year 3, the entity’s earnings increased only by 3 percent, and therefore the earnings target was not achieved. The executive completes three-year service and therefore satisfies the service condition. Because the earnings target was not achieved, the 3,000 vested share options have an exercise price of P40. 6) What is the compensation expense in year 2? A. 40,000 B. 30,000

C.

15,000

D.

12,000

7) What is the compensation expense in year 3? A. 60,000 B. 15,000

C.

12,000

D.

6,000...