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At December 31, Year 4, Hancock Company had 500,000 shares of common stock issued and outstanding, 400,000 of which had been

The first answer is correct but the next two are wrong. I'm looking for some help on the second two problems (#2 & #3). thank you.

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Answer #1

2.(c) equity option is used to purchase shares of stock. But the liability option is used to value the stock in dollars. 3.(a). The equity option have no effect on defferred taxes , it effects the period only when they(taxes) are incurred.

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