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  3. abc co. grants share based compensation to each of

ABC Co. grants share based compensation to each of its 1,200 employees. ABC Co, will...

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Accounting

ABC Co. grants share based compensation to each of its 1,200 employees. ABC Co, will pay
200 shares or the cash equivalent to the value of 200 shares to any employee who satisfies the 3 year service condition.
The fair value of the share at the grant date is $ 18.
The fair values of the shares and the employees whose interest is expected to vest at each reporting date are as follows:
Required:
Expected shares to be vested:
Year 1: 80%
Year 2: 90%
Year 3: 1000 employees
Fair value of equity instrument:
Year 1: $ 17
year 2: $ 16
year 3: $ 15
Calculate the liability for each of the Year 1,2 & 3 respectively and show the accounting entries for final settlement assuming the final settlement is in cash?

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