Suzanne Received 50 ISOs (Each Option Gives Her the Right

question 72

Essay

Suzanne received 50 ISOs (each option gives her the right to purchase 50 shares of stock for $11 per share)at the time she started working, when the stock price was $16.75 per share. Three years later, when the share price was $28.00 per share, she exercised all of her options. How much cash will Suzanne need on the exercise date of the stock options?

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Definitions:

Employer's Quarterly Federal Tax Return

A required document that employers must file with the IRS every quarter to report wages paid and taxes withheld.

Form

The visible shape or configuration of something, often pertaining to the physical appearance or structure of an object.

Quarterly

Pertaining to or occurring every three months.

Gross Earnings

The total income earned by an individual or organization before any deductions or taxes are subtracted.