FACTS:

* VEST IMMEDIATELY OR NOT? NO. OF SHARES = 40,000

* NO. OF SHARES = 40,000 X FV @ GD 15

* FAIR VALUE @ GRANT DATE = P15 TOTAL COMP.EXP. 600,000

* PAR VALUE = P5 DIVIDE BY VESTING PERIOD 2

* OPTION PRICE = P20 COMPENSATION EXPENSE 2018

P300,000
JOURNAL ENTRIES

12/31/18
Salaries Expense P300,000
Share Options Outstanding P300,000
12/31/19
Salaries Expense P300,000
Share Options Outstanding P300,000
1/15/20
Cash (40,000 x P20) P800,000
Share Options Outstanding 600,000
Ordinary Share Capital P200,000
Share Premium P1,200,000
FACTS:
JOURNAL ENTRIES:
* VEST IMMEDIATELY OR NOT?
1/1/18 Salaries Expense P1,600,000
* NO. OF SHARES = 200,000
Share Options Outstanding P1,600,000
* FAIR VALUE @ GRANT DATE = P8 12/31/18 Cash (200,000 x 15)P3,000,000
* PAR VALUE = P10 Share Options Outstanding P1,600,000
Ordinary Share Capital P2,000,000*
* OPTION PRICE = P15
Share Premium 2,600,000
NO. OF SHARES = 200,000
*Ordinary Share Capital (200,000 x 10)
X FV @ GD 8
COMPENSATION EXPENSE 2018 P1,600,000
FACTS:
* VEST IMMEDIATELY OR NOT?
* NO. OF SHARES = 60,000
* PREDETERMINED PRICE (PP) = P40
* MARKET VALUE (MV)
◦ 2019 = P56
◦ 2020 = P70
◦ 2021 = P60
2019 2020

MV P56 MV P70
PP (40)
PP (40)
EXCESS P30
EXCESS P16
X 60,000
X 60,000
TOTAL COMP.EXP. 1,800,000
COMP.EXP. 960,000 RECOGNIZED IN 2019 (960,000)
COMP.EXP. 2020 840,000

2021
MV P60
PP (40)
EXCESS P20
X 60,000
TOTAL COMP.EXP. 1,200,000
COMP.EXP 0
LIABILITIES: JOURNAL ENTRIES:
2019 : 960,000 2019 SALARIES EXPENSE P960,000
2020: 1,800,000 SALARIES PAYABLE P960,000
2021: 800,000 2020 SALARIES EXPENSE P840,000
60-40 X 20,000 = 400,000 SALARIES PAYABLE P840,000
60-70 X 60,000 = 600,000 2021 SALARIES PAYABLE P400,000
CASH P400,000

SALARIES PAYABLE P600,000

CASH P600,000