Solution-What was the gain or loss recognized in the income

What was the gain or loss recognized in the income statement

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Q1. On January 1, 2020, BLITZEN Company granted the president, 20,000 share appreciation rights for past services. Those rights are exercisable immediately and expire on January 1, 2023. On exercise, the grantee is entitled to receive cash for the excess of the market price on the exercise date over the market price on the grant date. The grantee did not exercise any of the rights in 2020. The market price of share was P30 on January 1, 2020 and P45 on December 31, 2020. What amount should be recognized as compensation expense for 2020?

Q2. On January 1, 2021, RUDOLPH Company received P107,720 for a P100,000 face amount, 12% bond, a price that yields 10%. The bonds pay interest semi-annually. The entity elects the fair value option for valuing financial liabilities. On December 31, 2021, the fair value of the bond is determined to be P106,460. The entity recognized interest expense of P12,000 in the 2021 income statement. What was the gain or loss recognized in the income statement to report this bond at fair value?

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What was the gain or loss recognized in the income statement

Reference no: EM133087191

Reference no: EM133087191

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