DRAX Company granted 30,000 share appreciation rights which entitled key employees to receive cash equal to the difference between ₱50 and the market price of the share on the date each right is exercised. The service period is 2020 through 2022, and the rights are exercisable in 2023. The market price of the share was ₱55 and ₱60 on December 2020 and 2021, respectively. What amount should be recorded as compensation expense for 2021?  a. ₱ 200,000 b. ₱ 150,000 c. ₱ 50,000 d. ₱ 350,000

Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter19: Accounting For Post Retirement Benefits
Section: Chapter Questions
Problem 3RE: Pinecone Company has plan assets of 500,000 at the beginning of the current year and expects to earn...
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  1. DRAX Company granted 30,000 share appreciation rights which entitled key employees to receive cash equal to the difference between ₱50 and the market price of the share on the date each right is exercised. The service period is 2020 through 2022, and the rights are exercisable in 2023. The market price of the share was ₱55 and ₱60 on December 2020 and 2021, respectively. What amount should be recorded as compensation expense for 2021? 

a. ₱ 200,000

b. ₱ 150,000

c. ₱ 50,000

d. ₱ 350,000

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