Helen Receives the Right to Acquire 700 Shares of Smith $\quad$

question 29

Short Answer

Helen receives the right to acquire 700 shares of Smith Corporation stock through the company's incentive stock option plan.The fair market value of the stock at the date of the grant is $8 and the exercise price of the option is $15 per share.The fair market value of the stock at the date of exercise is $19.Helen will recognize income at the date of grant and the exercise date of
Date of grant $\quad$ Exercise date
a. $\$ - 0 -$$\quad$$\$ - 0 -$
b. $\$ - 0 - \quad \$ 2,800$
c. $\$ - 0 - \quad \$ 4,900$
d. $\$ 5,600 \quad \$ - 0$ -

---

Definitions:

Termination

The act of ending or concluding something, such as a contractual agreement, employment, or a legal entity.

State Law

Laws enacted by a state government that apply within its specific geographic territory and are distinct from federal laws.

Procedures

Established methods or steps followed to complete a task or process.

Franchise Agreement

A contract between a franchisor and franchisee outlining the terms for operating a franchise business.