Response to the following problem:
On January 2, year 1 Argy company's granted 12000 stock options to a select group of senior emplyees. The requisite service period is three years, with one third of the options vesting at the end of each calendar year (graded vesting). An option pricing model was used to calculate a fair value of $5 for each option on the grant date. The company assumes all 12000 options will vest.
Required: Determine the amount to be recognized as compensation expense in year 1, 2, 3 under IFRS AND US GAAP prepare journal entries.