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On January 1, 2017, options were granted to the CEO to purchase 13,000 shares at $20 per share. The par value per share is $15.

On January 1, 2017, options were granted to the CEO to purchase 13,000 shares at $20 per share. The par value per share is $15.

The options are non-transferable and the CEO has to remain an employee of the company to exercise the option.

The options expire on 1/1/2021. It is assumed that the options are for services performed equally in 2017 and 2018.

The Black-Scholes option pricing model determines total compensation expense to be $360,000

On January 1, 2019, the CEO exercised 2,500 options. The market price was $70 per share.

Instructions:

Prepare the general journal entries necessary to record these transactions. Leave any lines you don't need blank. Select the accounts from

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