On October 1, 2021, Iona Ford Co. issued stock options for 300,000 shares to a division manager. The options have an estimated fair value of $3 each. To provide additional incentive for managerial achievement, the options are not exercisable unless divisional revenue increases by 6% in three years. Ford initially estimates that it is probable the goal will be achieved. After one year, Ford estimates that it is not probable that divisional revenue will increase by 5% in three years. In 2022, Ford will:
A. reverse the amount expensed in 2021.
B. record one-half of the new estimated total compensation.
C. take no action.
D. continue to record the original estimated compensation.
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