Q20? Please help!

On January 1 of Year 1, Shay Dee Company established a stock option plan for its senior employees. A total of 600,000 options were granted that permit employees to purchase 600,000 shares of stock at $40 per share. Each option had a fair value of $3 on the grant date. The market price for Shay Dee stock on January 1 of Year 1 was $40. The employees are required to remain with Shay Dee for four years (Years 1 through 4) to exercise these options. Shay Dee's net income for Year 1, before including any consideration of compensation expense, is $750,000. Compute the COMPENSATION EXPENSE associated with these options for Year 1. O $300,000 $600,000 O $450,000 O $187,500 O $1,800,000