Under U$.$S$.$ GAAP, a deferred tax asset related to stock option plans is recorded when Blank$\_\_\_\_\_\_$ and reversed when Blank$\_\_\_\_\_\_.$

Multiple choice question.

the options are $"$in the money"; the options are exercised

the options are exercised; compensation expense is recognized

compensation expense is recognized; the options are exercised

the options are $"$in the money"; compensation expense is recognized