Required information Comprehensive Problem 12-50 (LO 12-1, LO 12-2, LO 12-3) [The following information applies to the questions displayed below) Pratt is ready to graduate and leave College Park. His future employer (Ferndale Corp.) offers the following four compensation packages from which Pratt may choose. Pratt will start working for Ferndale on January 1 year 1 Benefit Description Option 1 Option 2 Option 3 Option 4 Salary $ 60,000 $ 50,000 $45,000 $ 45,000 Health insurance No coverage $5,000 $5,000 $ 5, Restricted stock 1,000 shares NQO's 100 options @ Assume that the restricted stock is 1,000 shares that trade at $5 per share on the grant date (January 1 year 1). shares are expected to be worth $10 per share on the vesting date at the end of year 1, and no 83(b) election is made. Assume that the NQOs (100 options) each allow the employee to purchase 10 shares at $5 exercise price. The stock trades at $5 per share on the grant date (January 1. year 1) and is expected to be worth $10 per share on the vesting date at the end of year 1, and the options are exercised and sold at the end of the year. Also assume that Pratt spends on average $3,000 on health-related costs that will be covered by insurance if he had coverage or is an after- tax expense if he isn't covered by insurance (treat this as a cash outflow). Assume that Pratt's marginal tax rate is 35 percent. (Ignore FICA taxes and time value of money considerations) Comprehensive Problem 12-50 Part 2 [MUST MANUALLY GRADE) Download the Tax Form and enter the required values in the appropriate fields. Assuming Pratt chooses Option 3 and sells the stock on the vesting date (on the last day of year 1). complete Pratt's Form 8949 for the sale of the restricted stock Please right click on the attached Adobe document and select open in new window. Then, download the Tax Form and enter the required values in the appropriate fields. Save your completed Tax Form to your computer and then upload it here by clicking "Browse." Next, click "Save." Use 2018 tax rules regardless of year on tax form. 8949 Fom Sales and Other Dispositions of Capital Assets Det of OU 1545-0074 Go to www.is.goviForm for instructions and the latest information 2018 File with your schedule to all your transactions for lines 1, 2, 3, sh, and 10 of Schedule D. Act Saree No 12A Social security number or paper delicion mber me shown on Before you check Box AB, or below, see whether you received any Form 1099-8 or substitute statement from your broker. A substitute statement will have the savne information as Form 1089-8. Either we show whether your basisly your cost was reported to the IRS by your broker and may even tol you which box to check Part I Short-Term. Transactions involving capital assets you held 1 year or less are generally short-term (see instructions). For long-term transactions, see page 2 Note: You may aggregate all short-term transactions reported on Forms) 1099-8 showing basis was reported to the IRS and for which no adjustments or codes are required. Enter the totals directly on Schedule D, line 18; you aren't required to report these transactions on Form 8949 (see Instructions). You must check Box A, B, or C below. Check only one box. If more than one box applies for your short-term transactions complete a separate Form 8949, page 1, for each applicable box. If you have more short-term transactions than will it on this page for one or more of the boxes, complete as many forms with the same box checked as you need A Short-term transactions reported on Form) 1099-B showing basis was reported to the IRS (see Note above) () Short-term transactions reported on Forms) 1099-B showing basis wasn't reported to the IRS (C) Short-term transactions not reported to you on Form 1090-8 Amary, to gainer you want tal Costoroba con Gano origin of reperty De Dale Proces the Notebol See the printin Suomi E 100 XYZ da) Moda and Co from and Moda in the come the none Code Bom Amount non ment 2 Totals. Add the amounts in cold Nuct negative amounts Enter each other and include on you Schedule Dine 16 Box Above is checked. line 20 Box above is checked. Be Box above the Noter if you checked Box A above but the basis reported to the IRS was incorrect enter in column to the basis as reported to this, and enter an adjustment in column to correct the basis See Column in the separate instructions for how to figure the amount of the adjustment For Paperwork Reduction Act Notice, see your tax return instructions, Cat 372 For 8949 01 Form 2018 Na hononeum Narend SSN or paydonlashown on our side Attachment Sequence No. 12A Page 2 Social security number or taxpayer identification number Before you check Box D, E or F below, see whether you received any Forms) 1099-B or substitute statements from your broker. A substitute statement will have the same information as Form 1099-8. Either will show whether your basis usualy your cost) was reported to the IRS by your broker and may even tell you which box to check Part II Long-Term. Transactions involving capital assets you held more than 1 year are generally long-term (s00 instructions). For short-term transactions, see page 1 Note: You may aggregate all long-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS and for which no adjustments or codes are required. Enter the totals directly on Schedule D line 8a: you aren't required to report these transactions on Form 8949 (see Instructions) You must check Box D, E, or F below. Check only one box. If more than one box applies for your long-term transactions, completo a separate Form 8949, page 2, for each applicable box. If you have more long-term transactions than will fit on this page for one or more of the boxes, complete as many forms with the same box checked as you need (D) Long-term transactions reported on Form) 1099-B showing basis was reported to the IRS (see Note above) (Long-term transactions reported on Forms) 1099-B showing basis wasn't reported to the IRS Long-term transactions not reported to you on Form 1009-8 Ade, Wary, to gain or lo 1 mourincomid La Contorer bi werden Gainor Description of property Ownego Du Proces See the Notebolowed the parte instruction Subtraction are 100 XYZ) dispod Moday. May truction w prica and see Column from comidad in the sport ( comune truction Codes) Brod Amount of wo Instructions ada fej 2 Totals. Add the mountain columna di and Nutract negative amounts Enter each total here and include on your Scheine Box above is checked. line Box above is checked.rine 10 of Box F above checked Note: If you checked Box D above but the basis reported to the IRS was incorrect enter in column the basis as reported to the RS, and enter an adjustment in column fol to correct the basis. See Column in the separate instructions for how to figure the amount of the adjustinent Porn 894901