On January 1, 2010, Madelle Corp. granted an employee an option to purchase 3,000 shares of Madelle's P5 par value ordinary shares at P20 per share. The option became exercisable on December 31, 2011, after the employee completed two years of service. The option was exercised on January 10, 2012. The market prices of Madelle's shares and share options were as follows: Market price Market price of Date of share similar share option Jan. 1, 2010 P30 P8 Dec. 31, 2010 Dec. 31, 2011 45 For 2010, Madelle should recognize compensation expense of a. P45,000 C. P15,000 b. P30,000 d. P12,000 50 An entity grants to an employee the right to choose either 1,000 phantom shares, le a right to a cash payment equal to the value of 1,000 shares, or 1,200 shares. The grant is conditional upon the completion of three years' service. If the employee chooses the share alternative, the shares must be held for three years after vesting date. At grant date, the entity's share price is P50 per share. At the end of years 1, 2 and 3, the share price is P52, P55 and P60 respectively. The entity does not expect to pay dividends in the next three years. After taking into account the effects of the post-vesting transfer restrictions, the entity estimates that the grant date fair value of the share alternative is P48 per share. Compute for the amount to be recognized as compensation expense in year 2. a. P21,867 c. P19,334 b. P36,667 d. P19,200