On January 1, 2020, Swiss Company had 50,000 preference shares at ₱50 par value. 

The entity also had ordinary shares of 100,000 with a par value of ₱25. 

On September 30, 2020, the entity issued 20,000 share rights to purchase 10,000 ordinary shares. 

The share rights had an expiration date of February 1, 2021. 

The issue price of preference shares with share warrants is 5,250,000. 

On September 30, 2020, each preference share had a market value of ₱90 and the share rights had a market value of ₱25. 

All share rights are exercised on December 31, 2020. 

1) How much is the amount allocated to preference shares on September 30, 2020?

2) How much is the total share premium to be reported on September 30, 2020?

3) How much is the share premium credited on the date of exercise?

 

QUESTION:

On January 1, 2020, Iceland Company granted employees a share-based payment with cash and share alternatives. 

The provision includes the right to a cash payment equal to the value of 10,000 phantom shares or 9,200 ordinary shares with a par value of ₱20. 

Grant is conditional upon completion of 2 years of service. If the employees choose the share alternative, the shares must be held for 2 years after the vesting date.

Related share prices are: 

Date of grant ₱50 

December 31, 2020, ₱55 

December 31, 2021, ₱58

 

After taking into account the effect of vesting restrictions, the entity estimated that the fair value of the share alternative on the date of the grant is ₱62. 

How much is the salaries/compensation expense on December 31, 2020?

How much is the share premium on December 31, 2021? 

Answer rating: 100% (QA)

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