WorldStreet, Inc., offers a stock option plan to its regional managers. On January 1, 2026,10 million options were granted for 10 million $1 par common shares. The exercise price is the market price on the grant date, $8 per share. Options cannot be exercised prior to January 1, 2028, and expire December 31, 2032. The fair value of the options, estimated by an appropriate option pricing model, is $2 per option. Because the plan does not qualify as an incentive plan, WorldStreet will receive a tax deduction upon exercise of the options equal to the excess of the market price at exercise over the exercise price. The income tax rate is 21%. If you cannot find an appropriate account in the drop down menu, please put your account in the brown color cell. 1. Determine the total compensation cost pertaining to the stock option plan. Type in numbers only. $ Imillion 2. Prepare the appropriate journal entries to record compensation expense and its tax effect on December 31, 2026. 3. Prepare the appropriate journal entries to record compensation expense and its tax effect on December 31, 2027. million million million million million million million million million million million million