Pastore Inc

Multiple Choice

Pastore Inc. granted options for 1 million shares of its $1 par common stock at the beginning of the current year. The exercise price is $35 per share, which was also the market value of the stock on the grant date. The fair value of the options was estimated at $8 per option. What would be the total compensation indicated by these options?

A) $3 million.
B) $27 million.
C) $8 million.
D) $35 million.