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Finalchapter 25
Finalchapter 25
Finalchapter 25
Problem 25-1
2020
Salaries 40,000
Accrued salaries payable 40,000
2021
Salaries 200,000
Accrued salaries payable 200,000
2022
Salaries 180,000
Accrued salaries payable 180,000
Problem 25-2
2020
No entry
2021
Salaries 80,000
Accrued salaries payable 80,000
2022
Salaries 170,000
Accrued salaries payable 170,000
2021
Salaries 600,000
Accrued salaries payable 600,000
2022
Salaries 600,000
Accrued salaries payable 600,000
2023
Salaries 3,000,000
Accrued salaries payable 3,000,000
2024
Accrued salaries payable 4,800,000
Cash 3,200,000
Gain on reversal of share appreciation rights 1,600,000
Problem 25-4
2020
Salaries 750,000
Accrued salaries payable (50,000 x 15) 750,000
2021
Accrued salaries payable 750,000
Cash (50,000 x 8) 400,000
Gain on reversal of appreciation rights 350,000
Problem 25-5
2020
Salaries 1,000,000
Accrued salaries payable 1,000,000
2021
Salaries 2,000,000
Accrued salaries payable 2,000,000
2022
Salaries 2,000,000
Share options outstanding 2,000,000
2023
Salaries
Share options outstanding 2,000,000
2,000,000
Cash 13,000,000
Share options outstanding 8,000,000
Share capital 10,000,000
Share premium 11,000,000
Problem 25-6
1. 2020
Share appreciation rights (300 employees x 100) 30,000
Multiply by fair value 10
Total fair value 300,000
2021
Share appreciation rights 30,000
Multiply by fair value 12
Total fair value 360,000
2022
Share appreciation rights not yet exercised (250x 100) 25,000
Multiply by fair value 15
Accrued liability-12/31/2022 375,000
Accrued liability-12/31/2021 (240,000)
Compensation expense for 2022 135,000
2023
Share appreciation rights not yet exercised (100 x 100) 10,000
Multiply by fair value 18
Accrued liability 12/31/2023 180,000
Accrued liability 12/31/2022 (375,000)
Decrease in accrued liability (195,000)
2024
Share appreciation rights exercised (100 employees x 100) 10,000
Multiply by intrinsic value 20
Total payment in 2024 200,000
Accrued liability - 12/31/2023 (180,000)
Net compensation expense for 2024 20,000
2. 2020
Salaries 100,000
Accrued salaries payable 100,000
2021 140,000
Salaries 140,000
Accrued salaries payable
2022
Salaries 135,000
Accrued salaries payable 135,000
Salaries 50,000
Cash 50,000
2023
Accrued salaries payable 195,000
Salaries 195,000
Salaries 225,000
Cash 255,000
2024
Accrued salaries payable 180,000
Salaries 20,000
Cash 200,000
Problem 25-7
1. 2020
No compensation expense
2021
Share appreciation rights (100 x 600) 60,000
Multiply by fair value 15
Total fair value 900,000
2022 50,000
Share appreciation rights (100 x 500,000) 17
Multiply by fair value 850,000
Accrued liability 12/31/2022 (600,000)
Accrued liability-12/31/2021 (250,000)
Salaries expense for 2022
2023
Share appreciation rights (100 x 250) 25,000
Multiply by fair value 21
Accrued liability 12/31/2023 525,000
Accrued liability -12/31/2022 (850,000)
Decrease in liability for 2023 325,000
2024
Total payment (250 x 100 x 24) 600,000
Accrued liability 12/31/2023 (525,000)
Net salaries expense for 2024 75,000
2. 2020
Dec. 31 No Entry
2021
Dec. 31 Salaries 600,000
Accrued salaries payable 600,000
2022
Dec. 31 Salaries 250,000
Accrued salaries payable 250,000
Salaries 150,000
Cash 150,000
2023
Dec. 31 Accrued salaries payable 325,000
Salaries 325,000
Salaries 550,000
Cash 550,000
2024
Dec. 31 Accrued salaries payable 525,000
Cash 75,000
Salaries 600,000
Problem 25-8
1. Fair value of share alternative (25,000 shares x P48) 1, 200,000
Fair value of liability (20,000 shares x P51) 1,020,000
Equity component 180,000
2. Fair value of liability-12/31/2020 (20,000 x P54) 1,080,000
3. 2020
Salaries 420,000
Accrued salaries payable 360,000
Share options outstanding 60,000
2021
Salaries 580,000
Accrued salaries payable 520,000
Share options outstanding 60,000
2022
Salaries 480,000
Accrued salaries payable 420,000
Share options outstanding 60,000
4. 2022
Dec. 31 Accrued salaries payable 1,300,000
Share options outstanding 180,000
Cash 1,300,000
Share premium 180,000
5. 2022
Dec. 31 Share options outstanding 1,300,000
Accrued salaries payable 180,000
Cash 750,000
Share premium 730,000
Problem 25-9
1. Purchases 1,000,000
Accounts payable 900,000
Share options outstanding 100,000
Problem 25-16
Question 1 Answer D. 75,000
Question 2 Answer D. 305,000
Question 3 Answer A. 195,000
Problem 25-17
Question 1 Answer C. 800,000
Question 2 Answer C. 300,000
Question 3 Answer B. 1,000,000
Problem 25-18
Question 1 Answer A. 480,000
Question 2 Answer B. 420,000
Question 3 Answer C. 400,000
Problem 25-19
1. C 6. C
2. D 7. B
3. A 8. A
4. C 9. A
5. D 10. D