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How much is the share premium on December

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Reference no: EM133121349

QUESTION 1 - On January 1, 2020, Swiss Company had 50,000 preference shares at P50 par value.

The entity also had ordinary shares of 100,000 with a par value of P25.

On September 30, 2020, the entity issued 20,000 share rights to purchase 10,000 ordinary shares.

The share rights had an expiration date of February 1, 2021.

The issue price of preference shares with share warrants is 5,250,000.

On September 30, 2020, each preference share had a market value of P90 and the share rights had a market value of P25.

All share rights are exercised on December 31, 2020.

How much is the amount allocated to preference shares on September 30, 2020?

How much is the total share premium to be reported on September 30, 2020?

How much is the share premium credited on the date of exercise?

QUESTION 2 - On January 1, 2020, Iceland Company granted employees a share-based payment with cash and share alternatives.

The provision includes the right to a cash payment equal to the value of 10,000 phantom shares or 9,200 ordinary shares with a par value of P20.

Grant is conditional upon completion of 2 years of service. If the employees choose the share alternative, the shares must be held for 2 years after the vesting date.

Related share prices are:

Date of grant P50

December 31, 2020, P55

December 31, 2021, P58

After taking into account the effect of vesting restrictions, the entity estimated that the fair value of the share alternative on the date of the grant is P62.

How much is the salaries/compensation expense on December 31, 2020?

How much is the share premium on December 31, 2021?

Reference no: EM133121349

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