S Corporation Created a Stock Option Plan for Its Two

question 76

Multiple Choice

S Corporation created a stock option plan for its two top executives.The plan provided that each executive would receive 1,000 options, which would enable him or her to purchase 100 shares at 75 percent of the market price on the date the options, became exercisable.The options were exercisable in two years.At the date of granting the options, the market price of the shares was $12 per share.The date of measurement for the stock option plan was the:

• A)date the employees' exercise their options.
• B)end of the second year.
• C)end of the first year.
• D)date of grant.

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Definitions:

Fair

Pertaining to actions, policies, or procedures that are just, equitable, and impartial.

Borda Count

A voting system used to rank options or candidates in which voters order their preferences, and options are assigned points based on their order in each vote.

Rank

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