On January 2, 2021, ABC Company grants 50 shares each to 400 employees, conditional upon the employees' remaining in the company's employ during the vesting period. The shares will vest at the end of 2021 if the company's earnings increased by more than 15%; or at the end of 2022 if the earnings increased by an average of 12% over the two-year period; or at the end of 2022 if the earnings increased by an average of 10% over the three-year period. The shares have a fair value of P25 on January 2. 2021, which is equal to the share price on the grant date. At the end of 2021, earnings had increased by 13% and the company expects that earnings will continue to increase at a similar rate in 2022 and expects to vest in 2022. At the end of 2022, earnings increased by only 9% and therefore shares do not vest at the end of 2022. The company expects that earnings will continue to increase at similar rate. At the end of 2023, earnings increased by 9%. The amount of remuneration expense should the company recognize in its December 31, 2023 profit or loss?* O P83,333 O P250,000 O P166,667 O P500,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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On January 2, 2021, ABC Company grants 50 shares each to 400 employees, conditional upon
the employees' remaining in the company's employ during the vesting period.
The shares will vest at the end of 2021 if the company's earnings increased by more than 15%;
or at the end of 2022 if the earnings increased by an average of 12% over the two-year period;
or at the end of 2022 if the earnings increased by an average of 10% over the three-year
period. The shares have a fair value of P25 on January 2, 2021, which is equal to the share
price on the grant date.
At the end of 2021, earnings had increased by 13% and the company expects that earnings will
continue to increase at a similar rate in 2022 and expects to vest in 2022. At the end of 2022,
earnings increased by only 9% and therefore shares do not vest at the end of 2022. The
company expects that earnings will continue to increase at similar rate. At the end of 2023,
earnings increased by 9%.
The amount of remuneration expense should the company recognize in its December 31,
2023 profit or loss? *
O P83,333
O P250,000
O P166,667
O P500,000
Transcribed Image Text:On January 2, 2021, ABC Company grants 50 shares each to 400 employees, conditional upon the employees' remaining in the company's employ during the vesting period. The shares will vest at the end of 2021 if the company's earnings increased by more than 15%; or at the end of 2022 if the earnings increased by an average of 12% over the two-year period; or at the end of 2022 if the earnings increased by an average of 10% over the three-year period. The shares have a fair value of P25 on January 2, 2021, which is equal to the share price on the grant date. At the end of 2021, earnings had increased by 13% and the company expects that earnings will continue to increase at a similar rate in 2022 and expects to vest in 2022. At the end of 2022, earnings increased by only 9% and therefore shares do not vest at the end of 2022. The company expects that earnings will continue to increase at similar rate. At the end of 2023, earnings increased by 9%. The amount of remuneration expense should the company recognize in its December 31, 2023 profit or loss? * O P83,333 O P250,000 O P166,667 O P500,000
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