On November 1 of the currentyear, Ms. Rapport purchases 2,000 shares of XYZ Ltd. under a stock option plan. Black Angus Ltd. is a public corporation. Ms. Rapport provides you with the followinginformation:

Stock Option granted on June 1 of the prior year and Fair Market Value(FMV) at the"grant" date= $3/share

Optionprice, offered to employees= $3/share

Stock Option exercised on Nov. 1 of the current year and FMV at the"exercise" date= $11/share

On December 31 of the currentyear, Ms. Rapport continues to own the 2,000 shares of XYZ Ltd. The FMV of the shares on December 31 is $16 per share and Ms. Rapport anticipates the share value will continue to increase. The taxable employment benefit arising from the stock option for Ms. Rapport in the current yearis:

Choose the correct answer.

A. $6,000

B. $0

C. $26,000

D. $16,000