On January 1, 2017, Ajax granted certain executives a total of 100,000 stock options with a strike price of $40, a vesting date of January 1, 2019, and an expiration date of December 31, 2019. On June 5, 2018 an executive forfeited 30,000 options when she resigned. Of the remaining options, 60,000 were exercised on December 31, 2019. Based on the Black-Scholes formula, the options are valued at $7.50 per option. Ajax has $1 par common stock.

Required:

1. Write the journal entry on Dec 31, 2017 for stock option expense in 2017.

2. Write the journal entry on Dec 31, 2018 for stock option expense in 2018.

3. Write the journal entry on Dec 31, 2019 for stock option exercise.

4. Write the journal entry on Dec 31, 2019 for stock option expiration.