Assume that on January $1,$ year $1,$ ABC Incorporated issued $9,900$ stock options with an estimated value of $$18$ per option. Each option entitles the owner to purchase one share of ABC stock for $$34$ a share $($the per share price of ABC stock on January $1,$ year $1,$ when the options were granted$).$ The options vest at the end of the day on December $31,$ year $2.$ All $9,900$ stock options were exercised in year $3$ when the ABC stock was valued at $$37$ per share. Identify ABC's year $1,2,$ and $3$ tax deductions and book$-$tax differences $($indicate as favorable or unfavorable and as permanent or temporary$)$ associated with the stock options under the following alternative scenarios:

Required:

a$.$ The stock options are incentive stock options.

b$.$ The stock options are nonqualified stock options.

Complete the following table.

Note: For all requirements, leave no answer blank. Enter zero if applicable and select "Not Applicable" if no effect.

$\backslash$table$[[,$Year $1,$Year $2],[,\backslash$table$[[$Book$-$Tax$],[$differences$]],\backslash$table$[[$Favorable or$],[$Unfavorable$]],\backslash$table$[[$Tomporary or$],[$Permanent$]],\backslash$table$[[$Book$-$Tax$],[$differences$]],\backslash$table$[[$Favorablo or$],[$Unfavorable$]],\backslash$table$[[$Temporary or$],[$Permanent$]]],[$Under ASC $718,,,,,,],[$a$.$ Incentive Stock Options,,,,,,$],[\backslash$table$[[$b$.$ Nonqualified Stock Options$],[($temporary differences$)]],,,,,,],[\backslash$table$[[$b$.$ Nonqualified Stock Options$],[($permanent differences$)]],,,,,,]]$