Reference no: EM132545433

Point 1: At the beginning of 2020, Santander Company grants share options to each of its 100 employees working in the sales department. The share options will vest at the end of 2022, provided that the employees remain in the entity's employ, and provided that the volume of sales of a particular product increases by at least an average of 5 per cent per year. If the volume of sales of the product increases by an average of between 5 percent and 10 percent per year, each employee will receive 100 share options. If the volume of sales increases by an average of between 10 percent and 15 percent each year, each employee will receive 200 share options. If the volume of sales increases by an average of 15 percent or more, each employee will receive 300 share options.

Point 2: On grant date, Santander estimates that the share options have a fair value of P20 per option. Santander also estimates that the volume of sales of the product will increase by an average of between 10 percent and 15 percent per year. The entity also estimates, on the basis of a weighted average probability, that 19 percent of employees will leave before the end of 2022.

Point 3: By the end of 2020, seven employees have left and the entity still expects that a total of 19 employees will leave by the end of 2022. Product sales have increased by 12 percent and the entity expects this rate of increase to continue over the next 2 years.

Point 4: By the end of 2021, a further six employees have left. The entity now expects only three more employees will leave during 2022. Product sales have increased by 18 percent. The entity now expects that sales will average 16 percent or more over the three-year period.

Point 5: By the end of 2022, a further two employees have left. The entity's sales have increased by an average of 16 percent over the three years.

Question 1. How much is the compensation expense in 2020?

Question 2. How much is the compensation expense in 2021?

Question 3. How much is the compensation expense in 2022?

Question 4. How much is the share warrants outstanding as of yearend 2020?

Question 5. How much is the share warrants outstanding as of yearend 2021?

Question 6. How much is the share warrants outstanding as of yearend 2022?