Lance exercised a nonstatutory option on May $31,2024.$ He paid $$16,000$ for $100$ shares of his company's stock. The fair market value of the share on that day was $$20,000.$ Although Lance continues to hold these shares, he included the $$4,000$ difference between the fair market value and the purchase price as compensation income when he filed his $2024$ return.

What is Lance's basis in the stock?

$0$

$$4,000$

$$16,000$