Which of the Following Is True Regarding Stock Options

question 70

Multiple Choice

Which of the following is true regarding stock options?

• A)A loss is realized when stock options lapse.
• B)There is typically no tax effect on the grant date.
• C)Income recognized on the exercise date is greater for incentive stock options than nonqualified options.
• D)The bargain element on a nonqualified option is taxed to employees at capital gain rates.No tax effect is incurred by employees or employers on the grant date.

---

Definitions:

Economic Independence

The condition of having sufficient personal wealth to live, without needing to work for basic necessities.

Poverty

The state of being extremely poor or lacking sufficient resources to meet basic living needs such as food, shelter, and healthcare.

Ghost Dance Movement

A spiritual movement that emerged among Native American peoples, which prophesied an end to European American expansion and a revival of the Native American way of life.

Religious Revival

A renewal of religious enthusiasm and commitment within a community or society, often characterized by large public meetings and new spiritual vigor.