Hi there. I need help with these questions. Answers must be hundred words or more.

QUESTION 1:

Prior to the release of AASB 2, many reporting entities failed to recognise the share options being provided to senior executives. Why?

QUESTION 2:

Cottesloe Ltd has granted its managing director 50 000 share options conditional upon him remaining with the company for a further five years. In addition, the share price must increase by 50 per cent before the end of year 5.

REQUIREDHow should Cottesloe Ltd account for the above vesting conditions?

QUESTION 3:

In an article that appeared in Business Review Weekly on 4 March 2004 (entitled 'Share options trap'), it is stated that under AASB 2 'companies must value and record as an expense any options granted to employees in exchange for their services. Previously, Australian companies recorded share-based payments in the notes to financial statements, arguing that share-based payments did not cost the company anything'.

REQUIREDDo you think that there is any logic to the argument that 'share-based payments did not cost the company anything'?

QUESTION 4:

On 1 July 2023, Supplyco Ltd provides Grove Ltd with some inventory, which has a fair value of $200 000. In exchange for the inventory, Grove Ltd provides Supplyco Ltd with 20 000 shares in Grove Ltd.

REQUIREDProvide the accounting entry to account for the above equity-settled share-based transaction.