PROBLEM NN: Vicar Company initiated a performance-based employee share option plan on January 1, 2016. The performance base for the plan is net sales in the year 2018. The plan provides for share options to be awarded to the employee as a group on the following basis: Level Net sales range Options granted 1 Less than 2.5 million 10,000 2 P2.5 million - 4,999,999 20,000 3 P5 million - 10 million 30,000 4 More than 10 million 40,000 The options become exercisable on January 1, 2019. The options exercise price is P200 per share. On January 1, 2016, each option had a fair value of P90. The share market prices were: January 1, 2016 P250 December 31, 2016 300 December 31, 2017 350 December 31, 2018 320 The entity reported the following sales each year: 2016 2017 2018 4.5 million 5.5 million 7 million 64. What amount should be recognized as compensation expense for 2018? A. 600,000 B. 900,000 C. 1,200,000 D. 1,800,000