On January $1^{st}$ year $3,$ Terry's Board of Directors issued the management team $25,600$ stock options for Terry's $$1$ par common stock. Terry's stock price on that day was $$\frac{3\mathrm{.}60}{?}$ share. The Board set the strike price of the options at $$5\mathrm{.}20/$share to encourage the management team to focus on improving the company's stock price. The average stock price during Year $3$ was $$\frac{6\mathrm{.}80}{?}$ share. The options vest at the end of year $3$ and according to the Black Scholes Model, have a fair value of $$4\mathrm{.}80$ each on the date issued. Terry's management was pleased with the decision because this is the first time that the Board has offered them options as a form of compensation, although they were disappointed that the options could only be used to purchase stock, not redeemed for their fair value. No options were exercised in year $3.$