On January 1, 2013, Roberts Company adopts a share option plan and grants 40 executives 1,000 shares each at an exercise price of $30 a share. The fair value per option is $7 on the grant date. The company estimates that its annual employee turnover will be 4%. At the end of 2014, the company changes it's estimated employee turnover to be 5%. At the end of 2015, only 30,000 options vest as only 30 of the 40 executives actually remain. The compensation expense for 2015 will be:

$32,667

$89,600

$70,000

$40,000