Andy Buckthorn works for Delf Industries (a Public company). On December 31, 2019, Andy received options to
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Question:
Andy Buckthorn works for Delf Industries (a Public company). On December 31, 2019, Andy received options to buy 10,000 shares of Delf Industries for $15 per share. The options had vested and were exercisable immediately upon issue. At the date of issue, the shares had a FMV of $20 per share.
On August 30, 2020, Andy exercised all of his options and purchased 10,000 shares of Delf Industries. The FMV of the shares on August 30, 2020 was $25 per share.
On October 31, 2022, Andy needed some extra money to make a down payment on a new house and sold all 10,000 of his shares in Delf Industries for $50 per share.
REQUIRED:
- Based on above, calculate Andy's taxable income for tax years 2019 to 2022?
- Explain, how the tax consequences noted in '1' would differ if Delf Industries was a Canadian Controlled Private Corporation instead of a Public company.
Related Book For
Financial Reporting And Analysis
ISBN: 9781260247848
8th Edition
Authors: Lawrence Revsine, Daniel Collins, Bruce Johnson, Fred Mittelstaedt, Leonard Soffer
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