On December 31, 2016, Sedona Inc. granted 160,000 options to key executives. Each option allows the executive to purchase one common share at a price of $6. The options were exercisable beginning January 1, 2019, if the grantee was still employed by the company at the time of the exercise, and expire on December 31, 2020. On the grant date, shares were trading at $6 per share, and a fair value options pricing model determined total compensation to be $80,000. On May 1, 2019, 120,000 options were exercised when the market price of the shares was $7 per share. The remaining options lapsed on December 31, 2020 because the share price declined below $6. Assume that the entity follows IFRS. Prepare the necessary journal entries related to the stock option plan for the years ended December 31, 2016, through 2020
On December 31, 2016, Sedona Inc. granted 160,000 options to key executives. Each option allows the executive to purchase one common share at a price of $6. The options were exercisable beginning January 1, 2019, if the grantee was still employed by the company at the time of the exercise, and expire on December 31, 2020. On the grant date, shares were trading at $6 per share, and a fair value options pricing model determined total compensation to be $80,000. On May 1, 2019, 120,000 options were exercised when the market price of the shares was $7 per share. The remaining options lapsed on December 31, 2020 because the share price declined below $6. Assume that the entity follows IFRS.
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