Question
Grant Date (1/1/Y1):Target gave Mr. Rice 100 NQOs. Each option provided a right to purchase 10 shares of Target stock for $125/share. Exercise Date (8/1/Y5):
Grant Date (1/1/Y1):Target gave Mr. Rice 100 NQOs. Each option provided a right to purchase 10 shares of Target stock for $125/share.
Exercise Date (8/1/Y5): Targets stock price is $180/share so he decides to exercise all of his options
Sale Date (10/1/Y6): He decides to sell all of the shares for $200/share.
What are Mr. Rices taxes due on the grant date, exercise date, and sale date? Assume his marginal tax rate is 32% and his long-term capital gains rate is 15%.
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Intermediate Accounting
Authors: Donald E. Kieso, Jerry J. Weygandt, And Terry D. Warfield
13th Edition
9780470374948, 470423684, 470374942, 978-0470423684
