On January $1,20$X$1,$ Paragonah Company granted $150,000$ stock options to key employees. Each option allows an employee to buy one share of $$1$ par common stock for $$25,$ which was the market price of the shares on the grant date of January $1.$ In order to be able to exercise the options, the employees must remain with the company for THREE entire years. The fair value of each option on the date of grant was $$4.$

The stock$-$based compensation plan is performance based. As of the end of the first year $(20$X$1),$ the number of options that are probable to vest is $150,000.$ At the end of the second year $(20$X$2),$ the number of options that are probable to vest is $120,000.$ Which of ONE the following should be included in the journal entry necessary on the books of Paragonah Company at the end of $20$X$2($the SECOND year$)$ to recognize the $20$X$2$ compensation expense associated with this performance$-$based plan? Assume that the correct entry was made at the end of $20$X$1($the first year$).$

DEBIT to Compensation Expense of $$320,000$

DEBIT to Compensation Expense of $$160,000$

DEBIT to Compensation Expense of $$240,000$

DEBIT to Compensation Expense of $$120,000$