1. In 20x8, BT Inc. granted a nonqualified stock option to Ms..P to buy 500 shares...
1. In 20x8, BT Inc. granted a nonqualified stock option to Ms..P to buy 500 shares of BT stock at $20 per share for 10 years. At date of grant, BT stock was trading on NASDAQ for $20 per share. In the current year, Ms. P exercised the option when BT’s stock was trading at $37.10.
a) How much income must Ms. P recognize in 20x8 and in the current year because of the option?
b) What are the tax consequences of the stock option to BT Inc. in 20x8? In the current year?
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1. In 20x8, BT Inc. granted a nonqualified stock option to Ms..P to buy 500 shares...
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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 years. At date of grant, BT stock was trading on Nasdaq for $18.62 per share. In 2019, Ms. Pearl exercised the option when BT's stock was trading at $31.40 per share. a. How much income did Ms. Pearl recognize in 2014 and 2019 because of the stock option? b. Compute Ms. Pearl's basis in the...
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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 years. At date of grant, BT stock was trading on Nasdaq for $18.62 per share. In 2019, Ms. Pearl exercised the option when BT's stock was trading at $31.40 per share. a. How much income did Ms. Pearl recognize in 2014 and 2019 because of the stock option? b. Compute Ms. Pearl's basis in the...
This year, CSUEB Inc. granted a nonqualified stock option to Lucía Muñoz to buy 10,000 shares of CSUEB stock for $10 per share for five years. At date of grant, CSUEB stock was selling on a regional securities market for $8 per share. CSUEB recorded $25,000 compensation expense for the estimated value of the option. Five years after CSUEB granted the option to Lucía Muñoz, she exercised it on a day when CSUEB stock was selling for $12.00 per share....
On January 1, 2018, Sheridan Company granted Dic Williams, an
employee, an option to buy 500 shares of Sheridan Co. stock for $30
per share, the option exercisable for 5 years from date of grant.
Using a fair value option pricing model, total compensation expense
is determined to be $5240. Williams exercised his option on
September 1, 2018, and sold his 500 shares on December 1, 2018.
Quoted market prices of Sheridan Co. stock during 2018
were:
January 1
$28...
On January 1, 2019, Bramble Corp. granted Sam Wine, an
employee, an option to buy 1,000 shares of Bramble Co. stock for
$30 per share, the option exercisable for 5 years from date of
grant. Using a fair value option pricing model, total compensation
expense is determined to be $5580. Wine exercised his option on
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Quoted market prices of Bramble Co. stock in 2021 were:
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