Tom recently received 2,000 shares of restricted stock from his employer, Independence Corporation, when the share price was $10 per share. Tom's restricted shares vested three years later when the market price was $14. Tom held the shares for a little more than a year and sold them when the market price was $12. What is the amount of Tom's income or loss on the sale?
A) $4,000 loss.
B) $2,000 loss.
C) $0.
D) $4,000 gain.

Question

Quizplus · Accepted Answer

Tom's income or loss is calculated based on the difference between the sale price and the vested price. The shares vested at $14, and he sold them at $12, resulting in a $2 loss per share. For 2,000 shares, this is a $4,000 loss.

Tom Recently Received 2,000 Shares of Restricted Stock from His