The following events occurred at Charlotte Company surrounding stock options. Charlotte uses the fair value method of accounting for stock options.

On 1/1/21 options were granted to each of four executives to purchase 5,000 shares (a total of 20,000 shares) of the companys $2 par value common stock at a price of $25. The options were non-transferable and the executive had to remain an employee of the company through 12-31-22 to exercise the options. The options expire on 2/1/23. The Black-Scholes option pricing model determines the fair value of the options to be $1,350,000.

On 4/5/22, one of the four executives resigned from the company.

On 2/1/23, the remaining three executives exercised their options.

Required:

Prepare any necessary entries for 1/1/21, 12/31/21, 4/5/22, 12/31/22 and 2/1/23. If no entry is necessary, indicate as such.