Prepare the journal entries for the four-year period

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Pelangi Berhad granted 200,000 share appreciation rights to an employee. At the grant date, the company's share price is RM5.00. The share appreciation rights vest over a three-year period. At the end of year 3, the company will pay cash to the employee based on the value of the rights. At the end of year 4, further cash will be paid to the employee.

The fair values of the share appreciation rights using an option pricing model are as follows:

Year           Fair Value (RM)
0                  1.34
1                  1.58
2                  1.92
3                  2.20
4                  2.62

Problem 1: You are required to prepare the journal entries for the four-year period. Show the working.

Reference no: EM132974017

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