On January 1, 2018, Choosy Co. granted to an employee the right to choose either shares or cash payment. The choices are as follows: • Share Alternative: Equal to 25,000 shares with par value of P40. • Cash Alternative: Cash payment equal to the market value of 21,000 shares. The grant is conditional upon the completion of three years of service. On the grant date, on January 1, 2018, the share price P36. The share prices for the three year period are as follows: December 31, 2018 P46 December 31, 2019 P54 December 31, 2020 P60 After taking into account the effect of vesting restriction, Choosy Co. has estimated that the fair value of the share alternative is P45.

On January 1, 2018, Choosy Co. granted to an employee the right to choose either shares or cash payment. The choices are as follows: • Share Alternative: Equal to 25,000 shares with par value of P40. • Cash Alternative: Cash payment equal to the market value of 21,000 shares. The grant is conditional upon the completion of three years of service. On the grant date, on January 1, 2018, the share price P36. The share prices for the three year period are as follows: December 31, 2018 P46 December 31, 2019 P54 December 31, 2020 P60 After taking into account the effect of vesting restriction, Choosy Co. has estimated that the fair value of the share alternative is P45.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Please show relevant solution and journal entries as well. The highlighted choice is the answer. Please explain how to get it. thanks
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