You have worked at a Canadian controlled privatecorporation for 5 years. Three years ago your employergranted you options to acquire 4,000 shares for $54 pershare when the shares had a fair value of $40 per share.In February 2019, you exercise all of the options when thefair value was $82 a share. In May 2020, you sell the4,000 shares for $97 a share. What is the income taximpact for you in 2019 and 2020? Document calculationsof Net Income (Division B) and Taxable Income (DivisionC) for both 2019 and 2020.

The revenue for the government or the taxation authority being earned from the taxed paid by the…

Answered: 4,000 shares for $97 a share. What is…

4,000 shares for $97 a share. What is the income tax impact for you in 2019 and 2020? Document calculations of Net Income (Division B) and Taxable Income (Division C) for both 2019 and 2020.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

You have worked at a Canadian controlled private
corporation for 5 years. Three years ago your employer
granted you options to acquire 4,000 shares for $54 per
share when the shares had a fair value of $40 per share.
In February 2019, you exercise all of the options when the
fair value was $82 a share. In May 2020, you sell the
4,000 shares for $97 a share. What is the income tax
impact for you in 2019 and 2020? Document calculations
of Net Income (Division B) and Taxable Income (Division
C) for both 2019 and 2020.

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