- Assume that this is the equity-settled share-based transaction. Record all necessary journal entries from Jan. 1, Year 1 to December 31, Year2. Assume that this is the choice-of-settlement share-based transaction, in which the employees can choose to settle the options either (1) in shares of stock or (2) in cash. The option fair value of cash-settlement is equal to the fair value of equity-settlement.
- Record all necessary journal entries from Jan. 1, Year 1 to December 31, Year 2 if all employees choose the share settlement.