On January $1,$ year $1,$ Dave received $1,000$ shares of restricted stock from his employer, RRK Corporation. On that date, the stock price was $$7$ per share. Dave's restricted shares will vest at the end of year $2.$ He intends to hold the shares until the end of year $4,$ when he intends to sell them to help fund the purchase of a new home. Dave predicts the share price of RRK will be $$30$ per share when his shares vest and will be $$40$ per share when he sells them.

Note: Leave no answer blank. Enter zero if applicable. Input all amounts as positive values.

Problem $12-33$ Part a $($Static$)$

If Dave's stock price predictions are correct, what are the tax consequences of these transactions to RRK$?$