Question: Schmidt Electronics offered an incentive stock plan to its employees. On January1, Year1, options were granted for 90,000 $1 par common shares. The exercise price

Schmidt Electronics offered an incentive stock plan to its employees. On January1, Year1, options were granted for 90,000 $1 par common shares. The exercise price equals the $6 market price of the common stock on the grant date. The options cannot be exercised before January1, Year4, and expire on December31, Year 5. Each option has a value of $4 based upon an option pricing model. What is the journal entry to record the exercise of 85% of the options during Year 4 when the market price of the stock was$10

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