On January 1, 2018, 30 employees are granted stock options for 250 common shares each, a total of 7,500 shares, at an option price of $25 per share. The options vest 4 years after the grant date. The options are valued using an option pricing model at $60,000 total.

Forfeiture estimates are updated at the end of each year:

End of Year 2018 2019 2020 2021

Management Estimates

• Employees expected

to remain 26 (87%) 24 (80%) 23 (77%) n.a.

• Expected forfeitures 4 (13%) 6 (20%) 7 (23%) n.a.

Factual History

• Actual forfeitures 6 1 2 0
• Employees receiving options 21 (30 – 9)

REQUIRED: Prepare a schedule to calculate compensation expense each year and make entries for each year to record it