On January 1, 2020, GALANTY Company granted XYZ, its president 20,000 share appreciation rights for past services. These rights are exercisable immediately and expire on January 1, 2022. During exercise, XYZ is entitled to receive cash for the excess of the share market price on the exercise date over the market price on the grant date. XYZ did not exercise any of the rights during 2020. The market price of GALANTY’s share was P30 on January 1, 2020 and P45 on December 31, 2020. As a result of the share appreciation rights, GALANTY should recognize compensation expense for 2020 of?
On January 1, 2020, GALANTY Company granted XYZ, its president 20,000 share appreciation rights for past services. These rights are exercisable immediately and expire on January 1, 2022. During exercise, XYZ is entitled to receive cash for the excess of the share market price on the exercise date over the market price on the grant date. XYZ did not exercise any of the rights during 2020. The market price of GALANTY’s share was P30 on January 1, 2020 and P45 on December 31, 2020. As a result of the share appreciation rights, GALANTY should recognize compensation expense for 2020 of?
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter17: Business Tax Credits And The Alternative Minimum Tax
Section: Chapter Questions
Problem 5CE
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On January 1, 2020, GALANTY Company granted XYZ, its president 20,000 share appreciation rights for past services. These rights are exercisable immediately and expire on January 1, 2022. During exercise, XYZ is entitled to receive cash for the excess of the share market price on the exercise date over the market price on the grant date. XYZ did not exercise any of the rights during 2020. The market price of GALANTY’s share was P30 on January 1, 2020 and P45 on December 31, 2020. As a result of the share appreciation rights, GALANTY should recognize compensation expense for 2020 of?
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