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Four years ago, Billie Budd was granted 5,000 stock options with an exercise price of...

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Accounting

Four years ago, Billie Budd was granted 5,000 stock options with an exercise price of $30. The stock price was $30 on that date. On February 2 of this year, she exercised all 5,000 options at $67. On June 2 of this year, she sold 3,300 shares for $30 per share.

Which of the following statements is/are true?

  1. Billie will have ordinary income and long-term capital gains if she sells the stock she acquired with the options in December of next year.
  2. A portion of Billie's options cannot be ISOs.
  3. Billie will not have an AMT income adjustment if she sells the stock acquired with ISOs in June of this year.
  4. Billie will have additional ordinary income this year.

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