Illustration 7

On April 1, 2017, a company offered 100 shares to each of its 500 employees at 40 per share. The employees are given a month to decide whether or not to accept the offer. The shares issued under the plan shall be subject to lock-in on transfers for three years from grant date. The market price of shares of the company on the grant date is 50 per share. Due to post-vesting restrictions on transfer, the fair value of shares issued under the plan is estimated at 48 per share.

On April 30, 2017, 400 employees accepted the offer and paid 40 per share purchased. Nominal value of each share is $ 10.

Record the issue of shares in book of the company under the aforesaid plan.