Use These Option Quotes to Answer This Question

question 89

Multiple Choice

Use these option quotes to answer this question:

-You want to sell four call option contracts on ZZ Industries stock at a strike price of $32.50 a share.How much will you receive in option premiums if you place this order today?

• A) $300
• B) $1,290
• C) $1,320
• D) $728
• E) $546

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Definitions:

Direct Labor-Hours

The total number of labor hours worked by employees who are directly involved in the manufacturing process.

General Factory

An umbrella term referring to the physical location where manufacturing operations occur, encompassing all areas of production.

Activity Rate

A rate used in activity-based costing to allocate overhead costs to products or services, based on their consumption of activities.

Activity-Based Costing

An accounting method that assigns costs to products or services based on the activities required to produce or deliver them, providing more accurate product costing.