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Problem 1 2 - 2 8 ( LO 1 2 - 2 ) ( Algo ) Yost recelved 3 0 0 NQOs ( each option
Problem LO Algo Yost recelved NQOs each option glves Yost the right to purchase shares of Cutter Corporation stock for $ per share At the time he started working for Cutter Corporation three years ago, Cutter's stock price was $ per share. Yost exerclsed all of his optlons when the share price was $ per share. Two years after acquiring the shares, he sold them at $ per share. Note: Input all amounts as positive values. Leave no answer blank. Enter zero if appllcable. Required: a What are Yost's taxes due on the grant date, exerclse date, and sale date, assuming his ordinary marginal rate is percent and his longterm capital galns rate is percent? b What are Cutter Corporation's tax consequences amount of deduction and tax savings from deduction on the grant date, the exercise date, and the date Yost sold the shares? c Assume that Yost is "cash poor" and needs to engage In a sameday sale In order to buy his shares. Due to his bellef that the stock price is going to increase significantly, he wants to malntaln as many shares as possible. How many shares must he sell in order to cover his purchase price and taxes payable on the exercise? d Assume that Yost's options were exerclsable at $ and explred after five years. If the stock only reached $ durlng Its high point during the fiveyear perlod, what are Yost's tax consequences on the grant date, the exercise date, and the date the shares are sold, assuming his ordinary marginal rate is percent and his longterm capital galns rate is percent? Complete this question by entering your answers in the tabs below. Required What are Yost's taxes due on the grant date, exercise date, and sale date, assuming his ordinary marginal rate is percent and his longterm capital gains rate is percent? What are Cutter Corporation's tax consequences amount of deduction and tax savings from deduction on the grant date, the exercise date, and the date Yost sold the shares? Assume that Yost is "cash poor" and needs to engage in a sameday sale in order to buy his shares. Due to his belief that the stock price is going to increase significantly, he wants to maintain as many shares as possible. How many shares must he sell stock price is going to increase significantly, he wants to maintain as m in order to cover his purchase price and taxes payable on the exercise?
Problem LO Algo
Yost recelved NQOs each option glves Yost the right to purchase shares of Cutter Corporation stock for $ per share At the
time he started working for Cutter Corporation three years ago, Cutter's stock price was $ per share. Yost exerclsed all of his optlons
when the share price was $ per share. Two years after acquiring the shares, he sold them at $ per share.
Note: Input all amounts as positive values. Leave no answer blank. Enter zero if appllcable.
Required:
a What are Yost's taxes due on the grant date, exerclse date, and sale date, assuming his ordinary marginal rate is percent and his
longterm capital galns rate is percent?
b What are Cutter Corporation's tax consequences amount of deduction and tax savings from deduction on the grant date, the
exercise date, and the date Yost sold the shares?
c Assume that Yost is "cash poor" and needs to engage In a sameday sale In order to buy his shares. Due to his bellef that the stock
price is going to increase significantly, he wants to malntaln as many shares as possible. How many shares must he sell in order to
cover his purchase price and taxes payable on the exercise?
d Assume that Yost's options were exerclsable at $ and explred after five years. If the stock only reached $ durlng Its high point
during the fiveyear perlod, what are Yost's tax consequences on the grant date, the exercise date, and the date the shares are sold,
assuming his ordinary marginal rate is percent and his longterm capital galns rate is percent?
Complete this question by entering your answers in the tabs below.
Required
What are Yost's taxes due on the grant date, exercise date, and sale date, assuming his ordinary marginal rate is percent
and his longterm capital gains rate is percent?
What are Cutter Corporation's tax consequences amount of deduction and tax savings from deduction on the grant date, the
exercise date, and the date Yost sold the shares?
Assume that Yost is "cash poor" and needs to engage in a sameday sale in order to buy his shares. Due to his belief that the
stock price is going to increase significantly, he wants to maintain as many shares as possible. How many shares must he sell
stock price is going to increase significantly, he wants to maintain as m in order to cover his purchase price and taxes payable on the exercise?
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