Which of the Following Statements Regarding Nonqualified Stock Options (NQOs)

question 76

Multiple Choice

Which of the following statements regarding nonqualified stock options (NQOs) is false?

• A) Book-tax differences associated with NQOs may be either permanent or temporary.
• B) If the initial estimated value of the options that are exercised during the year is greater than the bargain element of those options, the book-tax difference for that year is unfavorable.
• C) If the initial estimated value of the options that are exercised during the year is greater than the bargain element of those options, the book-tax difference for that year is entirely temporary.
• D) None of the above (all of the above are true).

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