Share-based Payments

On January 1, 20x1, JP CO. agreed to issue 5000 shares to Rock Company in exchange for construction of a building. Ownership of the building was trasferred on November 30, 2021. However, the contract price was settled on January 01, 20x2.

At which date should JP Co recognize the acquisition of building?

• January 01, 20x1

• November 30, 20x1

• January 01, 20x2

• November 30, 20x2

On January 01, 20x1, Gen Co. grants 10,000 share option to its employees. The share option entitles the employees to purchase Gen Co.'s shares at PHP 110 per share. Gen Co.'s shares have a par value of PHP 100 per share and a fair value of PHP 120 per share. The share options have fair value of PHP 15 per share.

If the Shares vest immediately, what amount should be debited as Salaries Expense on January 01, 20x1?

• 150,000

• 1,000,000

• 1,200,000

• 1,500,000

On January 01, 20x1, Gen Co. grants 10,000 share option to its employees. The share option entitles the employees to purchase Gen Co.'s shares at PHP 110 per share. Gen Co.'s shares have a par value of PHP 100 per share and a fair value of PHP 120 per share. The share options have fair value of PHP 15 per share. The shares vest immidiately and the employees exercised the share option at July 01, 20x1.

Which of the following is the correct journal entry at July 01, 20x1

• Debit to cash of 1,100,000

• Credit to cash of 1,100,000

• Debit to share premium of 150,000

• Credit to share capital of 150,000

Which of the following statements is incorrect?

• When share option vests immediately, total compensation expense is recognized in full

• When share option do not vest immediately, total compensation expense is recognized in full

• When share option vests immediately, there is no vesting period to complete

• When share option do not vest immediately, there is a required vesting period to complete.

Which of the following is true about the Fair Value Method?

• It is only computed annually

• It is mandated by IFRS 2

• measures the fair value of options at the date of purchase

• None of these

What are the two measurement methods of share options?

• Fair value and Initial value

• Fair value and Appraisal value

• Fair value and Intrinsic value

• Fair value and Future value

On January 1, 20x1, ABC Inc. granted 400 share options to all its employees (200 employees), conditional upon the remaining employees in the entity upon a 3-year vesting period. On the grant date. Each share option has a fair value of P35, an option price of P30 and a par value of P25.

By December 31, 20x1, 10 employees have left the entity and according to a weighted average probability, 10 more employees will most likely leave during the in 20x2. How much compensation expense should the entity recognize on December 31, 20x1?

• 886,666.67

• 720,000

• 840,000

• 2,520,000

On January 1, 20x1, ABC Inc. granted 400 share options to all its employees (200 employees), conditional upon the remaining employees in the entity upon a 3-year vesting period. On the grant date. Each share option has a fair value of P35, an option price of P30 and a par value of P25.

By December 31, 20x2, the entity decided to award them early and settled with a cash payment of 4,000,000. No employees left the entity during the year 20x1 and 20x2. How much compensation expense should the entity recognize?

• 1,200,000

• 2,133,333.33

• 1,480,000

• 1,600,000

An accounting standard that governs Share-based payments

• IFRS 3

• IFRS 2

• IFRS 6

• None of these

It is a transaction in which the entity acquires goods or services and pays for them by issuing its own equity instruments or cash based on the value of its equity instruments.

• Share-based payment transaction

• Cash-settled share based transaction

• both are correct

• none are correct