The Following Information Relates to Questions

question 10

Multiple Choice

The following information relates to questions
Viola Ltd has granted each of its 10 senior executives a choice between receiving a cash payment equivalent to 1000 shares or receiving 1200 share. The grant is conditional on the completion of three years’ service with the company. If the share alternative is chosen, the shares must be held for two years after vesting date. At grant date the company’s share price is £25 per share. At the end of years 1, 2 and 3 the share price is £27, £28 and £30 respectively. The company does not expect to pay dividends in the next three years. After taking into account the effect of post-vesting transfer restrictions the company estimates the grant-date fair value of the share alternative is £24 per share.
-What is the fair value of the cash alternative?

• A) £240 000
• B) £250 000
• C) £288 000
• D) £300 000

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Definitions:

Scripts

Defined as structured sequences of behavior or actions expected to be followed in specific contexts or situations.

Sensate Focus Therapy

Treatment for sexual dysfunction in which partners alternate between giving and receiving stimulation in a relaxed, openly communicative atmosphere in order to reduce performance anxiety and concern over achieving orgasm by learning each partner’s sexual fulfillment needs.

Intercourse

Sexual activity, especially involving penetrative sex between two or more individuals.

Sexual Dysfunctions

Disturbances in sexual desire and the psychophysiological changes that are part of the sexual response cycle, causing significant distress and interpersonal difficulty.