An entity grants 100 cash share appreciation rights (SARs) to each of its 500 employees, on condition that the employees remain employed for the next three years. During the year 1, 35 employees have left. The entity estimates that a further 60 will leave during year 2 and 3. During year 2, 40 employees have left and the entity estimates that a further 25 will leave during year 3. During year 3, 22 employees have left. At the end of year 3, 150 employees exercised their SARs, another 140 employees exercised their SARs at the end of year 4 and the remaining 113 employees exercised their SARs at the end of year 5.The entity estimates the fair value of the SARs at the end of each year in which a liability exists as shown below. At the end of year 3, all SARs held by the remaining employees vested. The intrinsic values of the SARs at the date of exercise (which equal the cash paid out) at the end of years 3, 4, and 5 are also shown: Fair Value-Year 1=14.40, 2=15.50 ,3=18.20, 4=21.40 ,Intrinsic Value-Year 3=15, 4=20, 5=25. Based on the preceding information, answer the following: 1. What amount of compensation expense should be recognized in year 1? 2. What amount of compensation expense should be recognized in year 2? 3.What amount of compensation expense should be recognized in year 3? 4.What amount of compensation expense should be recognized in year 4? 5.What amount of compensation expense should be recognized in year 5? 6. What amount of salaries payable should the entity report at the end of year 3? 7. What amount of salaries payable should the entity report at end of year 4?