In: Accounting
Which of the following statements concerning restricted stock is correct? (A) An executive purchases restricted stock at a price that is equal to the market value on the date of the grant. (B) An executive can elect to be taxed at the time of the grant of the restricted stock but cannot recoup tax payments if the stock is later forfeited. (C) Dividends on the stock are only paid to the executives after any restrictions are removed from the ownership. (D) When the limitations lapse, the executive reports the difference between the initial value of the stock and current market value as capital gain.
Which of the following statements concerning restricted stock is correct?
Answer:
(D) When the limitations lapse, the executive reports the difference between the initial value of the stock and current market value as capital gain.
Because of Restricted stock offer to exective less than market value with certain limition.