On December 21, year 5, the board of directors of Oak Corporation approved a plan to award 600,000 share options to 20 key employees as additional compensation. Effective January 1, Year 6, each employee was granted the option to purchase 30,000 shares of the company's $2 part value stock at-the-money exercise price equal to the January 1, Year 6, market price of $36 per share. All share options cliff vest at December 31, Year 8, the end of the 3-year requisite service period. They explore on December 31, Year 15. None of the costs associated with this shared-based compensation plan will be capitalized as an asset, and tax effects should be ignored in the calculations. Based on an appropriate option-pricing formula, the fair value of the options was estimated at $12 per option. During the most recent years, Oak Corporation has experienced a turnover rate of approximately 5% per year of employees eligible for the plan. Oak expected this turnover rate to continue during the 3-year requisite service period.

During the period from January 1, year 9 through December 31, year 15, 400,000 of the 437,400 share options that vested were exercised. The remaining 37,400 were not exercised. What amount of the $5,248,000 previously recognized compensation expense should be adjusted upon expiration of the stock options?

a. $74,800

b. $0

c. $1,720,000

d. $448,800