Martin Corporation Granted a Nonqualified Stock Option to Employee Caroline

Martin Corporation granted a nonqualified stock option to employee Caroline on January 1, 2013. The option price was $150, and the FMV of the Martin stock was also $150 on the grant date. The option allowed Caroline to purchase 1,000 shares of Martin stock. The option itself does not have a readily ascertainable FMV. Caroline exercised the option on August 1, 2018, when the stock's FMV was $250. Caroline sells the stock on September 5, 2019, for $300 per share. Martin Corporation will be allowed a deduction of

A) $100,000 in 2018 and $50,000 in 2019.
B) $100,000 in 2018.
C) $50,000 in 2019.
D) $150,000 in 2013.