Q18: Brie granted 10,000 equity settled share based payments to its 20 directors on 1 January 2015. Theoptions vest on 31 December 2017. It is anticipated that none of the directors will leave over the threeyear period. The fair value of the option is as follows:1 January 201512.0031 December 201513.5031 December 201613.8031 December 201714.20Prepare the extracts to be shown in the statement of profit or loss and the statement of financialposition for each of the three years ended 31 December 2015 to 31 December 2017.

Income statement: The income statement determines the net income of the business by subtracting the…

Answered: Prepare the extracts to be shown in the…

Prepare the extracts to be shown in the statement of profit or loss and the statement of financial position for each of the three years ended 31 December 2015 to 31 December 2017.

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

Chapter15: Contributed Capital

Section: Chapter Questions

Problem 5MC

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Drake Company has granted 200 share appreciation rights to each of its 300 employees on January 1, 2016. The rights are due to vest on December 31, 2017, with payment being made on December 31, 2018. During the year 2016, the company estimated that all options would vest, although only 90% of the options actually vested. Share prices are as follows: January 1, 2016. P20 December 31, 2016. 24 December 31, 2017. 27 December 31, 2018. 30 1. What liability will be recorded on December 31, 2016 as a result of the share appreciation rights? 2. How much compensation expense should be recorded for the year ended December 31, 2017?
Barron Company granted 8 million of its no par common shares to executives, subject to forfeiture if employment is terminated within three years. The common shares have a market price of $3 per share on January 1, 2021, the grant date. When calculating diluted EPS at December 31, 2022, what will be the net increase in the denominator of the EPS fraction if the market price of the common shares averaged $4 per share during 2022? A. 6 million B. 2.67 million C. 2 million D. 8 million
On January 1, 2016, Dan Corporation granted an employee an option to purchase 3,000 shares of Dan’s P5 par value ordinary share at P20 each. The option became exercisable on December 31, 2018. The option was exercised on January 10, 2019.The market prices of Dan’s share capital were as follows:January 1, 2016 – P30; December 31, 2016 – P50; January 10, 2019 – P45. The company cannot reliably determine the fair value of the share option, so it decided to use the intrinsic value method. For the year 2016, how much should Dan recognize as compensation expense?
24. On 1 July 2023 Cooloola Ltd provided 1 million options to its chief executive officer. The options were valued at $1.00 each and allowed the chief executive officer to acquire shares in Cooloola Ltd for $7 each. The chief executive officer is not permitted to exercise the options before 30 June 2025 but may then exercise them at any time between 1 July 2025 and 30 June 2026. The market price of the Cooloola Ltd shares on 1 July 2023 was $6.50. On 31 December 2025 the share price reaches $7.70, and the chief executive officer decides to exercise her options and acquire the shares in Cooloola Ltd. Required: Account for the issue and exercise of the options in Cooloola Ltd.
Jane Company has granted 200 share appreciation rights to each of its 300 employees on January 1, 2016. The rights are due to vest on December 31, 2017, with payment being made on December 31, 2018. During the year 2016, the company estimated that all options would vest; although only 90% of the options actually vested. Share prices are as follows: January 1, 2016 P20 December 31, 2016 24 December 31, 2017 27 December 31, 2018 301. What liability will be recorded on December 31, 2016 as a result of the share appreciation rights? 2. How much compensation expense should be recorded for the year ended December 31, 2017?
Share-based Compenstation On January 1, 2015, WAY Inc. granted 100 share options to its 500 employees. The share options are subject to the condition that the employees must remain to the company for a period of 3 years. The share option is not traded at the stock market. Each share option entitles the holder to acquire one ordinary share with P2 par value for P5 per share. The ordinary shares of WAY Inc. which are listed at the stock market are trading at the following prices: 12/31/2015 – P8; 12/31/2016 – P7; 12/31/2017 – P10. As of December 31, 2015, 80 employees have left and the company estimated based on weighted average probability that 20 employees will leave during the vesting period. As of December 31, 2016, 40 employees have left and the company estimated based on weighted average probability that 30 employees will leave during the vesting period. As of December 31, 2017, 130 employees have left. On January 1, 2018, all share options are exercised. Required: 1.…
Xero Ltd (Xero) grants 750 share options to each of its six directors on 1 May 2020 and the share options will vest on 30 April 2022. The fair value of each option on 1 May 2020 and 30 April 2021 are $15 and $17 respectively and their exercise price is $10 per share. At 30 April 2021, it is anticipated that 90% of the share options will vest on 30 April 2022. Required: What will be the accounting entry in the financial statements of Xero for the year ended 30 April 2021 in accordance with HKFRS 2 'Share-based Payments'? A. Increase equity $34,425; increase in expense in profit or loss $34,425 B. Increase equity $30,375; increase in expense in profit or loss $30,375 C. Increase equity $20,250; increase in expense in profit or loss $20,250 D. Increase equity $60,750; increase in expense in profit or loss $60,750
4. ABC Co. issued a prospectus for the issue of 900,000shares at $6 per shares on 1 January 2019. The prospectus specified that $3.50 was payable on application, a further $1.25 was payable on allotment and the final $1.25 was payable at call. On 31 January 2019 ABC issued 300,000 shares. On 31 May 2019, the company made the call for the outstanding balance of $1.25 per share. The call was payable by 30 June 2019. At 30 June 2019, the call on 30,000 shares remained unpaid.Instructions:b) The Share Capital that would appear in the Balance Sheet of ABC Co. (2marks)
4. ABC Co. issued a prospectus for the issue of 900,000shares at $6 per shares on 1 January 2019. The prospectus specified that $3.50 was payable on application, a further $1.25 was payable on allotment and the final $1.25 was payable at call. On 31 January 2019 ABC issued 300,000 shares. On 31 May 2019, the company made the call for the outstanding balance of $1.25 per share. The call was payable by 30 June 2019. At 30 June 2019, the call on 30,000 shares remained unpaid.Instructions:a) Prepare the journal entries to account for the issue of shares for ABC andb) The Share Capital that would appear in the Balance Sheet of ABC Co.
Niles Company granted 42 million of its no par common shares to executives, subject to forfeiture if employment is terminated within three years. the common shares have a market price of 14 per share on january 1, 2017, the grant date of the restricted stock award. when calculating dilluted EPS at december 31,2018, what will be the net increase in the denominator of teh EPS fraction if the market price of teh common shares averaged 14 per share during 2018?
Niles Company granted 9 million of its no par common shares to executives, subject to forfeiture if employmentis terminated within three years. The common shares have a market price of $5 per share on January 1, 2017, thegrant date of the restricted stock award. When calculating diluted EPS at December 31, 2018, what will be thenet increase in the denominator of the EPS fraction if the market price of the common shares averaged $5 pershare during 2018?