On January $1,2024,$ Waterway Corporation granted $9,300$ options to key executives. Each option allows the executive to purchase one share of Waterway's $$5$ par value common stock at a price of $$20$ per share. The options were exercisable within a $2-$year period beginning January $1,2026,$ if the grantee is still employed by the company at the time of the exercise. On the grant date, Waterway's stock was trading at $$25$ per share, and a fair value option$-$pricing model determines total compensation to be $$409,000.$

On May $1,2026,7,440$ options were exercised when the market price of Waterway's stock was $$30$ per share. The remaining options lapsed in $2028$ because executives decided not to exercise their options.

Prepare the necessary journal entries related to the stock option plan for the years $2024$ through $2028.($List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select $"$No Entry" for the account titles and enter $O$ for the amounts. Record entries in the order displayed in the problem statement.$)$

Date

Account Titles and Explanation

Debit

Credit

$$

$$

$$

$$

$$