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 employee

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The compensation element in a stock option granted to a corporate employee is the difference between the fair market value of the stock on the date of grant and the exercise price. Therefore, the date on which to measure the compensation element is the date on which the employee is granted the option.

The Date on Which to Measure the Compensation Element in a Stock