Question: When Fred joined CanPubCo in 2018, CanPubCo granted Fred a stock option to purchase 1,000 of its common shares at $16 per share. At the

When Fred joined CanPubCo in 2018, CanPubCo granted Fred a stock option to purchase 1,000 of its common shares at $16 per share. At the time the option was granted, CanPubCos shares were trading at $15 per share. On March 1, 2020, Fred exercised his option and purchased 1,000 shares of CanPubCo. (FMV of CanPubCo shares on March 1, 2020 was $22 per share). On October 31, 2020, he sold all of the shares at $24. required:a) What amounts will he include in calculating his taxable income for 2020?

b) CanPubCo has also provided Fred with an interest-free loan of $18,000 on March 1, 2020 for the purpose of acquiring shares in CanPubCo. The loan is still outstanding at the end of the 2020 year. What amount must Fred include in his income in regards to the loan for the 2020 taxation year? Show your calculations below

Show your calculations below

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