Allow taxes to be delayed on stock appreciation gains

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Reference no: EM131327062

Which of the following statements concerning stock bonus plans and ESOPs is(are) true?

1. They both give employees a stake in the company through stock ownership and allow taxes to be delayed on stock appreciation gains.

2. They both limit availability of retirement funds to employees if an employer’s stock falls drastically in value and create an administrative and cash-flow problem for employers by requiring them to offer a repurchase option (a.k.a. put option) if their stock is not readily tradable on an established market.

Reference no: EM131327062

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