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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (64910)	7/20/1999 2:48:00 PM
From: Ilaine	Read Replies (1) \| Respond to of 132070

Mike, when Microsoft buys its shares on the open market for employees that exercise stock options, it pays the difference between the strike price and the market price, so that's an actual expense, right? And it's compensation to the employee so it's a legitimate business expense. I don't understand why they say it's a tax benefit, to me it's a tax deduction. Do I misunderstand what's going on? I thought the part that fooled investors is that they don't realize how much cash the company may have to pay out when employees exercise options, so they think the company has more cash and less debt than is really the case, because of the way that the transactions are stated on the balance sheet. Edit: I think Wayne and exaccnt clarified matters.