Schmidt Electronics, a calendar year company that prepares financial statement annually, offered an incentive stock plan to its employees. On January 1, Year 1 , options were granted for 80,000$1 par redeemable preferred shares. The exercise price equals the $6 market price of the common stock on the grant date. The options cannot be exercised before January 1, Year 4 , and expire on December 31 , Year 5 . On January 1, Year 1 , each option has a value of $3 based upon an option pricing model. The fair value of the options on December 31 , Year 1 . Year 2 and Year 3 was $3.25, $3.50, and $3.75, respectively. Estimated forfeiture rates on December 31 , Year 1 , Year 2 , and Year 3 were 2%,3%, and 2%, respectively. Actual forfeitures tor these same dates were 2,500,2,000, and 1,500, respectively. On February 15, Year 4,65,000 options were exercised. No other options were exercised. Provide all necessary journal entries over the life of these options, assuming Schmidt reports actual forfeitures. Include dates in your entries. Schmidt Electronics, a calendar year company that prepares financial statement annually, offered an incentive stock plan to its employees. On January 1, Year 1 , options were granted for 80,000$1 par redeemable preferred shares. The exercise price equals the $6 market price of the common stock on the grant date. The options cannot be exercised before January 1, Year 4 , and expire on December 31 , Year 5 . On January 1, Year 1 , each option has a value of $3 based upon an option pricing model. The fair value of the options on December 31 , Year 1 . Year 2 and Year 3 was $3.25, $3.50, and $3.75, respectively. Estimated forfeiture rates on December 31 , Year 1 , Year 2 , and Year 3 were 2%,3%, and 2%, respectively. Actual forfeitures tor these same dates were 2,500,2,000, and 1,500, respectively. On February 15, Year 4,65,000 options were exercised. No other options were exercised. Provide all necessary journal entries over the life of these options, assuming Schmidt reports actual forfeitures. Include dates in your entries