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Chapter 12
Share-based Payments (Part 1)

NAME: Date:
Professor: Section: Score:

QUIZ:
1. An entity has granted share options to its employees. The total expense to the vesting date of
December 31, 20X6, has been calculated as ₱8 million. The entity has decided to settle the award
early, on December 31, 20X5. The expense charged in the income statement since the grant date
of January 1, 20X3, had been year to December 31, 20X3, ₱2 million, and year to December 31,
20X4, ₱2.1 million. The expense that would have been charged in the year to December 31, 20X5,
was ₱2.2 million. What would be the expense charged in the income statement for the year
December 31, 20X5?
a. 2.2 million. b. 8 million. c. 3.9 million. d. 2 million.

Use the following information for the next two questions:

On January 1, 20x1, Golf View Village Co. grants 1,000 share options to each of its 180 employees on
condition that the employees remain in Golf View’s employ until the end of 20x3. The exercise price
per share option is ₱20. The fair value per share option is ₱80.

On December 31, 20x1, Golf View modifies the share option grant by reducing the exercise price to
₱60. This resulted to an increase in the fair value per option before the modification of ₱100 to ₱120
after the modification.

2. What amount of compensation expense shall be recognized in 20x1?

a. 4,800,000 b. 3,600,000 c. 1,800,000 d. 1,200,000

3. What amount of compensation expense shall be recognized in 20x2?

a. 4,800,000 b. 6,600,000 c. 7,200,000 d. 9,600,000

Use the following information for the next two questions:

On January 1, 20x1, Creek Co. grants 1,000 share options to each of its 180 employees on condition
that the employees remain in Creek’s employ until the end of 20x3. The exercise price per share
option is ₱20. The fair value per share option is ₱80.

On December 31, 20x1, Creek Co. modifies the share option grant by extending the vesting period to
the end of 20x4.

4. What amount of compensation expense shall be recognized in 20x1?

a. 4,800,000 b. 3,600,000 c. 1,800,000 d. 1,200,000

5. What amount of compensation expense shall be recognized in 20x2?

a. 4,800,000 b. 6,600,000 c. 2,400,000 d. 1,600,000