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16. In 2014, BT granted a nonqualified stock option to Ms. Pearl to buy 500 shares of BT stock at $20 per share for five year

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A.

given price per share
price per share 20
grant date 18.62
exercised date 31.4
no of shares 500
in 2014( at the time of exercise)
AMT(IN $)
grant price                                 10,000.00
exercise price                                   9,310.00
difference                                       690.00
NO INCOME GENERATED
Income in 2019 AMT(IN $)
market price 31.4
exercise price 18.62
income (per share) 12.78

b.

Mr. Pearl's basis in 500 shares
Income in 2019 AMT(IN $)
market price                                 15,700.00
exercise price                                   9,310.00
income generated                                   6,390.00

c.

IN YEAR 2014 NO TAX CONSEQUENSES
IN YEAR 2019 AMT(IN $)
capital gain(assume 40%)                                   2,556.00
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