Question: Five years ago, ABC, Incorporated granted Ms . Lu a nonqualified stock option to purchase 1 , 0 0 0 shares of ABC stock at

Five years ago, ABC, Incorporated granted Ms. Lu a nonqualified stock option to purchase 1,000 shares of ABC stock at $60 per share. On date of grant, the market price was $50 per share. This year, Ms. Lu exercised the option when the market price was $70 per share. Determine ABC's deduction, if any, resulting from Ms. Lu's exercise of the stock option in the current year.

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