7. On January 2, 2019, G Corp adopted a stock option plan for its 5 top executives whereby each was granted options to purchase 2.000 shares of G's $10 par value common stock. The options are non-transferable and the executives must remain as employees of the company for 2019, 2020, and 2021 in order to exercise the option, which become exercisable on 1/1/22 and expire on 2/1/26. The options allow the executives to purchase the G shares, which are currently trading at $35 a share, at $40 per share. The Black- Scholes option pricing model determines the total compensation expense to be $3,000,000 INSTRUCTIONS: (15 points) a. Prepare the journal entry, if any, for the issuance of the options on 1/2/19. b. Prepare the 12/31/19 journal entry to record the compensation expense for 2019. C. Assume that one of the employees is fired during 2020, prepare the 12/31/20 journal entrylentries to record the compensation expense for 2020. d. Assume that the remaining 4 executives exercise their options on 1/4/26. Prepare the journal entry for the exercise of the options. 8. On January 2, 2019, H Inc issued 1,000,000 of its 8%, 5-year bonds payable. The bonds pay interest semi-annually on June 30th and December 31st The bonds were issued to yield 10% (the market rate for such bonds.) (20 points) You are to use the following present value factors: Present Value of $1 Present Value of Ordinary Annuity 4%, 10 years 0.6756 8.111 8%, 5 years 0.6806 3.993 5%, 10 years 0.6139 7.722 10%, 5 years 0.6209 3.791 INSTRUCTIONS: a. Determine the issuance price of the bonds. b. Prepare the journal entry for the issuance of the bonds on 1/2/19. c. Using the effective interest method to amortize any discount or premium on the bonds, prepare the 12/31/19 journal entries to record the 2019 interest expense. d. Prepare the journal entry for the retirement of the bond at maturity on 1/2/24. 9. On January 1, 2019, I Inc. issued $1,000,000 of its 10-year, 10% bonds at 97. INSTRUCTIONS: (10 points) a. Assume that the bonds are not retired until their maturity date, determine the total interest expense over the life of the bonds. b. Assume INSTEAD that the bonds are redeemed early at 102 when the remaining unamortized discount is $12,000, prepare the journal entry to record the early redemption of the bonds payable