On January $1,2024,$ Felix Austead Athletic Club $($FAAC$)$ granted stock options to key executives exercisable for $500,000$ shares of the company's common stock at $$18$ per share. The stock options are intended as compensation for the next four years. The options are exercisable within a four$-$year period beginning January $1,2028,$ by the executives still in the employ of the company. No options were terminated during $2024,$ but the company anticipates $5\%$ forfeitures over the life of the stock options. The market price of the common stock was $$18$ per share at the date of the grant. FAAC estimated the fair value of the options at $$4$ each. $1\%$ of the options are forfeited during $2025$ due to executive turnover. What amount should FAAC record as compensation expense for the year ended December $31,2025,$ assuming FAAC chooses the option not to estimate forfeitures?

Multiple Choice

$$ $$490,000$

$$ $$500,000$

$$ $$1,980,000$