With Options Contracts, Money Does Not Change Hands When the Contract

question 62

True/False

With Options contracts, money does not change hands when the contract is created.

---

Definitions:

Expenses

Monetary outflows or costs incurred in an entity's operations.

Owner's Equity

The residual interest in the assets of a company after deducting liabilities, representing the owner's claim on the business assets.

Net Income

The total earnings of a company after deducting all expenses and taxes from total revenue.

Drawings

Amounts withdrawn by the owner(s) of a business for personal use.