Six Years Ago, HOPCO Granted Mrs

question 24

Multiple Choice

Six years ago, HOPCO granted Mrs. Sing an incentive stock option (ISO) to purchase 1,000 shares of HOPCO stock for $55 per share. On date of grant, the market price was $50 per share. This year, Mrs. Sing exercised the ISO when the market price was $64 per share. How much ordinary income does she recognize because of the exercise?

• A) $0
• B) $5,000
• C) $9,000
• D) $14,000

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