Yvonne Exercises Incentive Stock Options (ISOs) for 100 Shares of Apple

question 47

Multiple Choice

Yvonne exercises incentive stock options (ISOs) for 100 shares of Apple Corporation stock at the option price of $100 per share on May 21, 2019, when the fair market value is $120 per share.She holds the stock for only seven months and sells the shares for $140 per share.Determine the recognized gain on the sale and classify it as capital or ordinary.

• A)$2,000 ordinary income and $2,000 STCG.
• B)$2,000 ordinary income and $2,000 LTCG.
• C)$4,000 ordinary income.
• D)$4,000 LTCG.
• E)None of these.

Familiarize with the theory of constraints and its significance in manufacturing strategy.

Understand various approaches to product pricing, including cost-plus pricing.

Understand the principles of activity-based costing and its advantages over traditional costing systems.

Recognize the factors influencing pricing decisions, including cost-plus and variable cost concepts.

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Definitions:

Reciprocal Determinism

A concept in psychology emphasizing the mutual influence between a person's behavior, personal factors, and the environment.

Self-serving Bias

A frequent inclination to credit good outcomes to personal qualities while blaming bad outcomes on outside circumstances.

Defensive Self-esteem

A form of self-esteem that is fragile and vulnerable to criticism, leading individuals to react defensively to perceived threats.

Accomplishments

Achievements, successes, or completed goals, often resulting from effort or skill.