Prepare the journal entry to record expense at December

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Question - On January 1, 20x4, a Big and Small Co. initiated a Share Appreciation Plan for its employees. The vesting period ended on December 31, 20x5. A total of 16,000 SAR's were issued. At December 31, 20x4, the company estimated that 12,000 SAR's would vest. At December 31, 20x5, the actual number of SAR's that vested were 12,500. A total 4,000 SAR's were also exercised on December 31, 20x5. The cash payment was debited to Administrative expenses. The SAR liability at December 31, 20x4 was properly calculated and is included in Accounts payable and accrued liabilities. The fair value and intrinsic value of the SAR's is as follows:

Date

Fair Value

Intrinsic Value

Dec 31, 20x4

$11

-

Dec 31, 20x5

14

$11.50

Required - Prepare the journal entry/entries to record compensation expense at December 31, 20x5.

Reference no: EM132549854

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