Parsons Limited established a share appreciation rights program that entitled its new president, Brandon Sutton, to receive cash for the difference between the shares' fair value and a pre-established price of $32 (also fair value on December 31, 2022), on 50,000 SARS. The date of grant is December 31, 2022, and the required employment (service) period is four years. The president exercised all of the SARS on December 31, 2027. The shares' fair value fluctuated as follows: December 31, 2023, $36; December 31, 2024, $39; December 31, 2025, $45: December 31, 2026, $36; and December 31, 2027. $48. The company recognizes the SARS in its financial statements. Assume that Parsons follows ASPE. (a) Prepare a five-year (2023 to 2027) schedule of compensation expense pertaining to the 50.000 SARs granted to Brandon. (Enter negative amounts using either a negative sign preceding the number eg.-45 or parentheses eg. (45)) Schedule of Compensation Expense-Share Appreciation Rights (50,000) Cumulative Compensation Recognizable Date 12/31/23 12/31/24 12/31/25 Fair Value $36 39 45 Pre- established Price $32 32 32 4 $ Percentage Accrued % % Compensi Accrued Date

Parsons Limited established a share appreciation rights program that entitled its new president, Brandon Sutton, to receive cash for the difference between the shares' fair value and a pre-established price of $32 (also fair value on December 31, 2022), on 50,000 SARS. The date of grant is December 31, 2022, and the required employment (service) period is four years. The president exercised all of the SARS on December 31, 2027. The shares' fair value fluctuated as follows: December 31, 2023, $36; December 31, 2024, $39; December 31, 2025, $45: December 31, 2026, $36; and December 31, 2027. $48. The company recognizes the SARS in its financial statements. Assume that Parsons follows ASPE. (a) Prepare a five-year (2023 to 2027) schedule of compensation expense pertaining to the 50.000 SARs granted to Brandon. (Enter negative amounts using either a negative sign preceding the number eg.-45 or parentheses eg. (45)) Schedule of Compensation Expense-Share Appreciation Rights (50,000) Cumulative Compensation Recognizable Date 12/31/23 12/31/24 12/31/25 Fair Value $36 39 45 Pre- established Price $32 32 32 4 $ Percentage Accrued % % Compensi Accrued Date

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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