What amount of share options outstanding smiley corporation

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In order to retain certain key executives, Smiley Corporation granted them incentive share options on December 31, 2017. 80,000 options were granted at an option price of P35 per share.

Market prices of the shares were as follows:

December 31, 2017 P46 per share

December 31, 2018 51 per share

The options were granted as compensation for executives' services to be rendered over a two-year period beginning January 1, 2017. The Black-Scholes option pricing model determines total compensation expense to be P800,000.

Problem 1: What amount of share options outstanding should Smiley Corporation should recognize as a result of this plan for the year ended December 31, 2018?

Reference no: EM132628364

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