On January 1st, 2021, Moon Corp. granted stock options to its senior executive officers. This is the only stock option plan that Moon offers and the details are as follows:

Option to purchase: 10,000 common shares

Option price per share: $33.00

Fair value per common share on date of grant: $25.40

Stock option expiration: December 31, 2028

Date when options are first exercisable: January 1, 2025

Total estimated compensation expense related to the options: $84,000

On January 1, 2023, 2,000 options were cancelled when one of the senior officers left the company. On January 1, 2026, 7,000 of the options were exercised when the fair value of the common shares was $36. The remaining stock options were allowed to expire. Assume that the entity follows ASPE and has decided not to include an estimate of forfeitures upon initial recognition of the compensation expense.

Required:

1. Record all journal entries required for 2021. (4 marks)

2. Record all journal entries required for 2023. (4 marks)

3. Record the journal entry on January 1, 2026, the exercise date. (5 marks)

4. Record any necessary journal entry for the expired options that were not exercised. (2 marks)