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Sunland Limited established a SARS program that entitled its new president, Susan Wilson, to receive cash for the difference between the Sunland common shares' fair value and a pre-established price of $31 (also fair value on December 31, 2022), on 48,700 SARs. The date of grant is December 31, 2022, and the required employment (service) period is four years. The common shares' fair value fluctuated as follows: December 31, 2023, $36; December 31, 2024, $41; December 31, 2025, $46; December 31, 2026, $36; and December 31, 2027, $49. Sunland recognizes the SARS in its financial statements. Susan exercised half of the SARS on June 1, 2028, when the share price was $47. Assume that Sunland follows ASPE.

Sunland Limited established a SARS program that entitled its new president, Susan Wilson, to receive cash for the difference between the Sunland common shares' fair value and a pre-established price of $31 (also fair value on December 31, 2022), on 48,700 SARs. The date of grant is December 31, 2022, and the required employment (service) period is four years. The common shares' fair value fluctuated as follows: December 31, 2023, $36; December 31, 2024, $41; December 31, 2025, $46; December 31, 2026, $36; and December 31, 2027, $49. Sunland recognizes the SARS in its financial statements. Susan exercised half of the SARS on June 1, 2028, when the share price was $47. Assume that Sunland follows ASPE.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Sunland Limited established a SARS program that entitled its new president, Susan Wilson, to receive cash for the difference between the Sunland common shares' fair value and a pre-established price of $31 (also fair value on December 31, 2022), on 48,700 SARs. The date of grant is December 31, 2022, and the required employment (service) period is four years. The common shares' fair value fluctuated as follows: December 31, 2023, $36; December 31, 2024, $41; December 31, 2025, $46; December 31, 2026, $36; and December 31, 2027, $49. Sunland recognizes the SARS in its financial statements. Susan exercised half of the SARS on June 1, 2028, when the share price was $47. Assume that Sunland follows ASPE.
Transcribed Image Text:Sunland Limited established a SARS program that entitled its new president, Susan Wilson, to receive cash for the difference between the Sunland common shares' fair value and a pre-established price of $31 (also fair value on December 31, 2022), on 48,700 SARs. The date of grant is December 31, 2022, and the required employment (service) period is four years. The common shares' fair value fluctuated as follows: December 31, 2023, $36; December 31, 2024, $41; December 31, 2025, $46; December 31, 2026, $36; and December 31, 2027, $49. Sunland recognizes the SARS in its financial statements. Susan exercised half of the SARS on June 1, 2028, when the share price was $47. Assume that Sunland follows ASPE.
Prepare a five-year (2023 to 2027) schedule of compensation expense pertaining to the 48,700 SARS granted to Susan. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) 2023 2024 2025 2026 2027 Fair Value $36 41 46 36 49 Pre-estab. Price $31 31 31 31 31 $ Difference Number of Rights $ Total Compensation Prepare a five-year (2023 to 2027) schedule of compensation expense pertaining to the 48,700 SARS granted to Susan. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) Number of Rights $ Total Compensation $ Accrual Entry Balance of Liability
Transcribed Image Text:Prepare a five-year (2023 to 2027) schedule of compensation expense pertaining to the 48,700 SARS granted to Susan. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) 2023 2024 2025 2026 2027 Fair Value $36 41 46 36 49 Pre-estab. Price $31 31 31 31 31 $ Difference Number of Rights $ Total Compensation Prepare a five-year (2023 to 2027) schedule of compensation expense pertaining to the 48,700 SARS granted to Susan. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) Number of Rights $ Total Compensation $ Accrual Entry Balance of Liability
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