On November 1, 2020,RiverbedCompany adopted a stock-option plan that granted options to key executives to purchase31,800shares of the company's $9par value common stock. The options were granted on January 2, 2021, and were exercisable 2 years after the date of grant if the grantee was still an employee of the company. The options expired 6 years from date of grant. The option price was set at $40, and the fair value option-pricing model determines the total compensation expense to be $477,000.

All of the options were exercised during the year 2023:21,200on January 3 when the market price was $68, and10,600on May 1 when the market price was $78a share.

Prepare journal entries relating to the stock option plan for the years 2021, 2022, and 2023. Assume that the employee performs services equally in 2022 and 2023.