On April $1,2020$ when the Company began, Kay Inc. granted $200,000$ options, with a strike price of $$6,$ to mechanical engineers in lieu of signing bonuses.

The fair value of each option was estimated at $$1$ and the options vest over four years.

a$.$ What is the total expense that the company will record associated with the options granted in $2020?$

b$.$ What will Kay Inc. record in $2020$ for the stock$-$option compensation expense?

c$.$ How will the exercise of the options impact the balance sheet, income statement and statement of cash flows?