Question Content AreaExhibit $15-3$

On January $1,2020,$ Howard, Inc. granted to a key executive a fixed compensatory share option plan for $1,000$ shares of $$4$ par common stock for $$30$ a share. The fair value per option on that date was $$14.$ The service period extended through December $31,2021.$

Refer to Exhibit $15-3.$ Which balance sheet disclosure would be correct at December $31,2020?$

Liabilities:

Employee stock option plan $$7,000$

Shareholders' equity:

Paid$-$in Capital Share Options $$7,000$

Less: Deferred compensation $7,000$

$$14,000$

Shareholders' equity:

Paid$-$in Capital Share Options $$7,000$

footnote disclosure only