Provide the journal entry to be recorded

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Question - IT Solutions Ltd. has a cash-settled SARs program for employees. These employees will receive a cash payment after five years of service, calculated as the excess of share price over $6.75. In early 20X1, employees in total are granted 100,000 units in the program.

The fair value of one SARs unit is estimated at $1 at the end of 20X1, $3 at the end of 20X2, and $2 at the end of 20X3. Estimated retention is 90% at the end of 20X1, 88% at the end of 20X2, and 75% at the end of 20X3. The payment is made at the end of 20X5.

Required - Provide the journal entry to be recorded with respect to the SARS program at the end of 20X1, 20X2, and 20X3.

Reference no: EM133175187

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