27) Schmidt Electronics offered an incentive stock plan to its employees. On January 1, Year 1, options were granted for 80,000 $1 par common shares. The exercise price equals the $6 market price of the common stock on the grant date. Year 4, and expire on December 31, Year 5. Each option has a value of $3 based upon an option pricing model. What is the journal entry to record compensation expense for Year 1? A. 240,000 240,000 B. 80,000 80,000 Compensation Expense APIC - Stock Options Deferred Compensation APIC - Stock Options Compensation Expense Deferred Compensation Compensation Expense Common Stock C. 80,000 80,000 D. 80,000 80,000 28) What is the journal entry to record the exercise of 85% of the options during Year 4 when the market price of the stock was $10. 408,000 204,000 80,000 532,000 A. Cash APIC-Stock options Common stock APIC B. Cash APIC-Stock options Common stock APIC 408,000 204,000 68,000 544,000 240,000 68,000 68,000 204,000 Cash APIC-Stock options Common stock APIC Cash APIC-Stock options Common Stock APIC D. 408,000 68,000 80,000 396,000