Problem $12-28($LO $12-2)($Algo$)$

Yost recelved $300$ NQOs $($each option glves Yost the right to purchase $10$ shares of Cutter Corporation stock for $$34$ per share$).$ At the

time he started working for Cutter Corporation three years ago, Cutter's stock price was $$34$ per share. Yost exerclsed all of his optlons

when the share price was $$68$ per share. Two years after acquiring the shares, he sold them at $$104$ 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 $35$ percent and his

long$-$term capital galns rate is $15$ 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 same$-$day 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 $$39$ and explred after five years. If the stock only reached $$37$ durlng Its high point

during the five$-$year 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 $35$ percent and his long$-$term capital galns rate is $15$ percent?

Complete this question by entering your answers in the tabs below.

Required $A$

What are Yost's taxes due on the grant date, exercise date, and sale date, assuming his ordinary marginal rate is $35$ percent

and his long$-$term capital gains rate is $15$ 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 same$-$day 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?