Walters Audio Visual Inc. offers an incentive stock option plan to its regional managers. On January 1, 2018, options were granted for 28 million $1 par common shares. The exercise price is the market price on the grant date $8 per share. Options cannot be exercised prior to January 1, 2020, and expire December 31, 2024. The fair value of the 28 million options, estimated by an appropriate option pricing model, is $1 per option. Required:1. Determine the total compensation cost pertaining to the stock option plan.2. Prepare the appropriate journal entries to record compensation expense and its tax effect on December 31,2018.3. Prepare the appropriate journal entries to record compensation expense and its tax effect on December 31,2019.4. Record the exercise of the options and their tax effect if all of the options are exercised on March 20, 2023,when the market price is $12 per share.5. Assume the option plan qualifies as an incentive plan. Prepare the appropriate journal entries to record compensationexpense and its tax effect on December 31, 2018.6. Assuming the option plan qualifies as an incentive plan, record the exercise of the options and their tax effectif all of the options are exercised on March 20, 2023, when the market price is $11 per share.