6. (9 points) On October 15, 2020, the board of directors of Trackstar approved a...
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6. (9 points) On October 15, 2020, the board of directors of Trackstar approved a stock option plan for key executives. On January 1, 2021, 28 million stock options were granted, exercisable for 28 million shares of Trackstar's $1 par common stock. The options are exercisable between January 1, 2024, and December 31, 2026, at 80% of the quoted market price on January 1, 2021, which was $15. The fair value of the 28 million options, estimated by an appropriate option pricing model, is $6 per option. All options were exercised on July 12, 2025, when the stock's price jumped unexpectedly to $27 per share. a. Prepare any entry(ies) necessary for 2021. Write dates beside your entry(ies). Date Debit Account Credit Account Debit Amount Credit Amount b. Prepare the journal entry to account for the exercise of the options. Date Debit Account Credit Account Debit Amount Credit Amount 7/12/2025
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