1. Rustin recently retired from Fox Inc. When he retired his stock bonus plan had 10,000 shares of Fox inc stock. They took deductions equal to $20 per share for the contributions made on Rustin’s behalf. At retirement, Rustin took a lump sum distribution of the employer stock. The fair market value of the stock at distribution was $35 per share. Six months later, Rustin sold the stocks for $40 per share. What amount was subject to ordinary income tax on Rustin’s tax return at the date Fox Inc contributed to the stock plan?

2. Assume the same facts presented in #12. What amount was subject to ordinary income on Rustin’s tax return at the time the stock was distributed?