Bowles Company granted options on January 1, 2017, permitting executives to purchase 800,000 of the companys $1 par common stock within the next five years, but not before December 31, 2020 (the vesting date). The exercise price is set at the stocks market price on the date of grant, $40 per share. The fair value of the options, estimated by an appropriate option pricing model, is $5 per option. At 12/31/17, 90% of the options are estimated to vest, and the stocks market value is $52/share. How much compensation expense should be recognized in 2017?

a) 3,600,000

b) 1,000,000

c) 900,000

d) 0