Lloyd is the CFO for a ﬁrm that uses ISOs as part of its executive compensation plan. He receives $150,000 annually, paid semimonthly, in base salary plus 25 shares of the ﬁrm's stock per month. The stock is omitted from gross pay calculations and is valued at $52.50 per share and he
May exercise his option within ﬁve years at $0.10 per share. What is Lloyd's gross pay for mid-October?
A) $6,250
B) $7,250
C) $8,250
D) $7,560

Question

Quizplus · Accepted Answer

Lloyd's annual salary is $150,000, paid semimonthly, which means he receives $150,000 / 24 = $6,250 per pay period. The stock is not included in the gross pay calculations.

Lloyd Is the CFO for a ﬁRm That Uses ISOs