On June 1, 20X6, Oak Corp. granted stock options to certain key employees as additional compensation. The options were for 1,000 shares of Oak's $2 par value common stock at an option price of $15 per share. Market price of this stock on June 1, 20X6, was $20 per share. The options were exercisable beginning January 2, 20X7, and expire on December 31, 20XX. Oak Corp. used the binomial option pricing model and estimated the value of each option at $7. On April 1, 20X7, when Oak's stock was trading at $21 per share, all the options were exercised. What amount of pretax compensation should Oak report in 20X6 in connection with the options