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In 2013, BB granted an incentive stock option (ISO) to Raul to buy 8,000 shares of BB stock at $8.00 per share for 10 years.

In 2013, BB granted an incentive stock option (ISO) to Raul to buy 8,000 shares of BB stock at $8.00 per share for 10 years. At date of grant, BB stock was trading on the AMEX for $7.84 per share. In 2022, Raul exercised the option when BB's stock was trading at $23.52 per share. Required: a. How much income did Raul recognize in 2013 and 2022 because of the ISO? b. Compute Raul's basis in the 8,000 shares. c. What are the tax consequences of the stock option to BB in 2013 and 2022

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