The date on which to measure the compensation element in a stock option granted to a corporate employee ordinarily is the date on which the employee1. has performed all conditions precedent to exercising the option. 2. is granted the option. 3. may first exercise the option. 4. exercises the option.

Question

Dana Henson

Business

22 October, 20:35

The date on which to measure the compensation element in a stock option granted to a corporate employee ordinarily is the date on which the employee1. has performed all conditions precedent to exercising the option. 2. is granted the option. 3. may first exercise the option. 4. exercises the option.

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Answers (1)

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Alessandra Barber · Answer 1

The correct answer is number "2": is granted the option.

Explanation:

Many corporations encourage employees to participate in the company's growth by offering them a piece of the pie. That means employees' stock options. The very same date when the stock option is granted to the employee is considered as the beginning date to measure the compensation element. Though, most stock options come with a vesting schedule that lists the dates an employee can exercise a specific number of shares.