C plc wants to reward its directors for their service to the company and has designed a bonus package with two different elements as follows. The directors are informed of the scheme and granted any options on 1 January 20X7.
1. Share options over 300,000 shares that can be exercised on 31 December 20Y0. These options are granted at an exercise price of €4 each, the share price of C plc on 1 January 20X7. Conditions of the options are that the directors remain with the company, and the company must achieve an average increase in profit of at least 10% per year, for the years ending 31 December 20X7 to 31 December 20X9. C plc obtained a valuation on 1 January 20X7 of the options which gave them a fair value of €3.
No directors were expected to leave the company but, surprisingly, on 30 November 20X9 a director with 30,000 options did leave the company and therefore forfeited his options. At the 31 December 20X7 and 20X8 year-ends C plc estimated that they would achieve the profit targets (they said 80% sure) and by 31 December 20X9 the profit target had been achieved.
By 31 December 20Y0 the share price had risen to €12 giving the directors who exercised their options an €8 profit per share on exercise.
2. The directors were offered a cash bonus payable on 31 December 20X8 based on the share price of the company. Each of the five directors was granted a €5,000 bonus for each €1 rise in the share price or proportion thereof by 31 December 20X8.
On 1 January 20X7 the estimated fair value of the bonus was €75,000; this had increased to €85,000 by 31 December 20X7, and the share price on 31 December 20X8 was €8 per share.

Required
Show the accounting entries required in the years ending 31 December 20X7, 20X8 and 20X9 for the directors’ options and bonus above.