12/31201 was $30 per share. The Black-Scholes opticn pricing model determined that each option had avalue of $7. The options become exercisable on January 1, 2022, and represent compensation for executivesservices over a three-year period beginning January 1, 2019. At December 31, 2019 none of the executives hadA On December 31, 2018, Free Company granted 15,000 options to its exocutive's to purchase 15,000of the company's S10 par common tock at an option price of $30 per share. The market value of the stockleft the company and the market value of the stock has increased to $32 per share.Part S: Various Questions-Be sure te circle your final anseer* what was the intrinsie value of the options when they were granted on December 31. 201- What is the Compensation Expense for the year ended December 31, 2019 as a result of this transacoeaccordance with US GAAP?3. Indicate below the impact of your 12/31/2019 joumal entry on the financial statement template belowStockholders' Paid-in CapitalEquityRetainedNetAssetsLiabilitiesin ExcessEarningsIncome(APIC)4. On January 1, 2022 when the stock was trading at $35 per share in the market, 10,000 of the options wereexercised. Prepare the journal entry below that would be made:

“Since you have posted a question with multiple sub-parts, we will solve first three subparts for…

Answered: of the company's S10 par common stock…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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In the Table below are the Numato Ltd's PUT Option prices (expiring on February 2022, March 2022 and April 2022) for various Strike Prices as on 15th January, 2022. Current Stock Price of Numato Ltd. is Rs 590. Determine the Intrinsic value and time value of PUT options (expiring on February 2022, March 2022 and April 2022) for various given Strike Prices at current price of Rs 590. Strike February Intrinsic Time Put Price Value March Intrinsic Time April Intrinsic Time Value Put Price Price Value Put Value Value Value (Rs.) (Rs) Price (Rs) (Rs) 500 0.50 3 5.5 550 2.50 9.5 14.5 600 17.5 28 34 650 59 62 66 700 109 109 109
You bought a $50 strike call option on a stock XYZ for $8.20 and then sold/wrote a $65 call option for $4.35 If the stock closes at $49 on expiration day, how much did you lose at expiration?
An investor owns a put option with a strike price of $ 20, the premium paid was $ 2.The stock price on the option expiration date is $ 25, which is the below statements is correct? The intrinsic value of the option is-$2 The loss on the option is $ 7 The option should be allowed to lapse The profit on the option is $ 3
Assume we are in July, 2023. In July of 2023, the share prices of company B are $80 per share. You believe they should be $30 per share, and are thus overvalued. December 2023 put options on a strike price of $60 per share are currently valued at $5. Each put contract is based on 100 shares. a.) What is your net dollar profit or loss as a holder of the put contract (based ona contract size of 100 shares) if we arrive at expiry in December and you are wrong and Company B shares are selling for $100? (Show your working in full)
What if the value of the put options? (Use two decimal places)
ABC Company's current stock price is $100. The risk-free rate is 4%. 38. The payoff to the holder of a call option on ABC with an exercise price of $200 is closest to: A. $100 if stock price at option expiration equals $200 B. Zero if stock price at option expiration equals $100 C. -S40 if stock price at option expiration equals $160
You purchased three contracts of "XYZ December 4 2015 84.00 Call" at $5.50 per options and exercised it when the underlying stock price was $92. What was your profit and return on the investment, excluding the commisions.
1. Three months ago an investment company bought for £8 a call option on a stock with an exercise price of £136. If the stock price at expiration of this option is £147. Select which of the following best describes the option value, the decision of the Investment Company and the return on investment thereon. A. Option value Decision Profit / (loss) % Exercise price – Stock price Exercise 37.5% B. Option value Decision Profit / (loss) % Stock price – Exercise price Don’t Exercise 2.2% C. Option value Decision Profit / (loss) % Exercise price – Stock price Exercise 2.2% D. Option value…
The following table lists the options on Amazon shares in January 2018 when Amazon stock was selling for $1,210. Exercise Price $1,210 1,310 1,410 Expiration Date July 2018 Call Price $161.90 104.10 62.65 a. Call option with exercise price of $1,210 b. Put option with exercise price of $1,210 C. Call option with exercise price of $1,310 d. Put option with exercise price of $1,310 e. Call option with exercise price of $1,410 f. Put option with exercise price of $1,410 Use the data in the table to calculate the payoff and the profits for investments in each of the following July maturity options, assuming that the stock price on the expiration date is $1,305. (Negative amounts should be indicated by a minus sign. Round your "Profit" answers to 2 decimal places.) Put Price $53.56 96.10 156.15 Payoff Profit
You purchased two contracts of "ABA December 11 2015 72.00 Put" at $4.20 per option and exercise it when the underlying stock price was $65.50. What is your profit and return on the investment, excluding the commissions?
Question 3?
Ch10-Q82. The stock price of GK is $45.23. One option generally involves 100 shares of underlying stock. If you buy the March put and don't exercise before contract maturity, you will make a profit if the stock price at maturity from today's price. Expiration Strike Mar Jun 50 50 Call price Put price ? 2.25 6.55 ? O increases by more than 9.65 percent O increases by more than 4.57 percent O decreases by more than 3.94 percent O decreases by more than 11.99 percent O does not decrease by more than 5.64 percent

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