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    Question

    Ms. Sonya received 500 ESOPs at Rs.20 each. The market

    value of the share at that time was Rs. 40, and Rs.50 at vesting time and Rs.75 at exercise time. What is the value of ESOPs for Ms. Sonya?
    A Rs.10,000 Correct Answer Incorrect Answer
    B Rs.15,000 Correct Answer Incorrect Answer
    C Rs.25,000 Correct Answer Incorrect Answer
    D Rs.27,500 Correct Answer Incorrect Answer
    E Rs.37,500 Correct Answer Incorrect Answer

    Solution

    Fair value for ESOP is calculated with reference to the grant date, taking into account the terms and conditions upon which those shares or stock options were granted. Value of ESOP = market value at grant – cost of ESOP                                            = Rs.40-Rs.20 per share                                            = Rs.20 per share Total value = 20*500 shares = Rs.10,000

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