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MINDA issued 11,000 SARs vesting immediately on 1 Apr 20X0. SAR FV ₹100 grant; ₹132 (Y1), ₹139 (Y2), ₹141 (Y3). Exercise rates: Y1 94%, Y2 91%, Y3 85% actual. Compute the journal at grant date.
ADr Employee benefits ₹14,52,000
BDefer recognition until exercise
CRecognise only ₹10,34,000 (11,000 × ₹100 × 94%)
DDr Employee benefits ₹11,00,000; Cr Share-based payment liability ₹11,00,000 (since vesting IS IMMEDIATE, full grant FV liability recognised at once)
Answer & Solution
Correct answer: D. Dr Employee benefits ₹11,00,000; Cr Share-based payment liability ₹11,00,000 (since vesting IS IMMEDIATE, full grant FV liability recognised at once)
SARs that vest IMMEDIATELY: full FV recognised at grant date (no vesting period to spread). Liability = 11,000 × ₹100 = ₹11,00,000. Subsequent reporting periods remeasure liability to FV.
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