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CIMA Management F2 Question # 50 Topic 6 Discussion

F2 Exam Topic 6 Question 50 Discussion:
Question #: 50
Topic #: 6

LM granted 100 share options to each of its 400 employees on 1 January 20X7.  The options will only vest if employees remain with LM for 3 years from the grant date.  The fair value of each share option was $5 on 1 January 20X7.

20 employees left in the year to 31 December 20X7 and at that date it was estimated that a further 35 would leave over the following two years.

Which of the following journal entries did LM process to account for the share options in the year to 31 December 20X7, in accordance with IFRS2 Share-based Payments?
A.

Dr Profit or loss $57,500 ; Cr Other reserves within equity $57,500

B.

Dr Profit or loss $57,500 ; Cr Liabilities $57,500

C.

Dr Profit or loss $172,500 ; Cr Other reserves within equity $172,500

D.

Dr Profit or loss $172,500 ; Cr Liabilities $172,500

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Actual exam question for CIMA F2 exam by Cyra88711 at May 2, 2026, 11:19:00 PM

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