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1) Zenny is one of the 20-year awardees of her company
1) Zenny is one of the 20-year awardees of her company. For her service, she received a watch worth P8,000, a plaque, and a check for P10,000. On the same day, she also received a bonus for her excellent performance for the entire duration of her service in the amount of P35,000. How much should be included in the "13th month pay and other benefits" of Zenny?
a. P55,000
b. P45,000
c. P35,000
d. Pzero
2. Mando, manager of XXX Domestic Corporation, received a stock option from the corporation entitling him to buy 5,000 shares of XXX at P10.00 per share. After some time, Mando exercised his option when the shares were selling at P15.00 per share. The shares, at the time of exercise, had a book value of p12.00 per share. After 3 months, Mando sold the shares for P18.00 per share. Compute the compensation income of Mando.
a. P50,000
b. P40,000
c. P25,000
d. P15,000
Expert Solution
Questions:
1. Zenny is one of the 20-year awardees of her company. For her service, she received a watch worth P8,000, a plaque, and a check for P10,000. On the same day, she also received a bonus for her excellent performance for the entire duration of her service in the amount of P35,000. How much should be included in the "13th month pay and other benefits" of Zenny?
Answer: b. P45,000
a. P55,000
b. P45,000
c. P35,000
d. zero
Bonus 35,000
Cash (check) 10,000
=Total 13th month pay and other benefits P45,000
Note:
*13th month pay and other benefits includes productivity incentive bonus, gift in cash or in kind and other benefits of similar nature.
2. Mando, manager of XXX Domestic Corporation, received a stock option from the corporation entitling him to buy 5,000 shares of XXX at P10.00 per share. After some time, Mando exercised his option when the shares were selling at P15.00 per share. The shares, at the time of exercise, had a book value of p12.00 per share. After 3 months, Mando sold the shares for P18.00 per share. Compute the compensation income of Mando.
Answer: c. P25,000
a. P50,000
b. P40,000
c. P25,000
d. P15,000
FMV P15 per share (higher the book value) x 5,000 shares= P75,000
Grant price P10.00 per share x 5,000 shares= P50,000
75,000- 50,000= P25,000
Step-by-step explanation
1. Answer: b. P45,000
Bonus 35,000
Cash (check) 10,000
=Total 13th month pay and other benefits P45,000
Note:
*13th month pay and other benefits includes productivity incentive bonus, gift in cash or in kind and other benefits of similar nature.
2. Answer: c. P25,000
FMV P15 per share (higher the book value) x 5,000 shares= P75,000
Grant price P10.00 per share x 5,000 shares= P50,000
75,000- 50,000= P25,000
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