**Question:**Which of the following is not a characteristic of a noncompensatory stock option plan?**Options:**- O The plan offers no substantive option feature.- O Substantially all full-time employees may participate on an equitable basis.- O Unlimited time period permitted for exercise of an option as long as the holder is still employed by the company.- O Discount from the market price of the stock no greater than would be reasonable in an offer of stock to stockholders or others.

Non compensatory stock option plans are those plans in which substantially all full time employees…

Answered: Which of the following is not a…

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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The seller (or the writer) of a call option: may have the obligation to sell the underlying asset at a strike price until an expiration date may have the obligation to buy the underlying asset at a strike price until an expiration date has the right to sell the underlying asset at a strike price until an expiration date has the right to buy the underlying asset at a strike price until an expiration date None of these answers are correct.
Under the perpetual system, a difference with the stocktake records might indicate: Select one alternative: damaged stock theft of stock obsolete stock All of the given options are correct
True/false An option is a financial contract that gives the owner the right to buy or sell some asset at a fixed price on or before a given date. The put-call parity is derived based on the principal of no arbitrage. That is, the put-call parity equation holds only when the market is reasonably good enough so that arbitrage opportunities are not allowed. Today Jim bought a call option and Jill wrote a call option. The options are exactly the same (with the same underlying asset, same exercise price, same expiration date, same in every aspect). When the underlying stock price changes, for every dollar Jim gains, Jill loses a dollar, and vice versa. In reality, stock option contracts are based on the unit of 100 shares and expire on the third Friday of the month. An out of the money option means that if you exercise the option now you will be able to get money out of it.
Why is a dissenting stockholder who demands payment of his shares no longer allowed to withdraw from his decision?
The buyer of a Call Option has the obligation to purchase shares of the underlying stock. True False
What date or event does the profession believe should be used in determining the value of a stock option? What arguments support this position?
Stock options: Multiple Choice have value only if the market price of the stock declines. have value only if the market price of the stock rises. are taxed at ordinary rates. do not qualify for favorable tax treatment.
When underwriting a new issue of stock, which of the following would describe a "Dutch auction"? A-the underwriter does not set a fixed price for the shares to be sold B- the underwriter is legally bound to use best efforts to get the best price C- the underwriter sells shares to other underwriters who then find investors D-the stock sold only to seasoned investors
True or False Buying a call option on shares is similar to selling a put option on those shares as both situations involve purchasing the underlying shares
Which of the following is NOT true? a. If the choice is cash, a liability has to be recorded until the SARS are exercised. b. Stock options will almost always have value, whereas restricted stock may not. C. An option-pricing model is not used for valuing restricted stock. d. An executive receiving restricted stock is given the stock prior to vesting.
When securities are allotted to institutional investors & some selected individuals is referred to Select one: a None b Offer through the prospectus c Offer for sale d Initial public offer e. Private place
Ef 235.

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