Reference no: EM132504664

Point 1: On January 2, 2018, the shareholders of Mari Company approved a plan that grants the company's four executives options to purchase 2,000 shares each of the company's P50 par value ordinary share. The options are granted on January 2, 2018 and may be exercised anytime from January 1, 2020 to December 31, 2020. Based on an option-pricing model used by the enterprise, the fair value of the option on January 2, 2018 is P35. The option price per share is P60 and the market price of the ordinary shares on January 2, 2018 is P90 per share.

Point 2: On June 30, 2019, an executive with option to purchase 2,000 shares decided to migrate to Canada and resigned from Mari Company. On March 31, 2020, all of the three remaining executives exercised their options.

Point 3: If during the vesting period, some options are cancelled due to non-completion of the minimum required service period, as in this example, the total value of the remaining options that has not been charged to expense shall be recognized as expense over the remaining number of years in the vesting period.

Required:

Question 1: Entries to record the above transactions.

The entity shall make no subsequent adjustment to total equity after the vesting date, even if some of the options that already vest are cancelled before their expiration date. However, the requirement of PFRS /IFRS 2 does not preclude the entity from recognizing a transfer within equity.