Which of the Following Statements Is FALSE

question 19

Multiple Choice

Which of the following statements is FALSE?

• A)When a holder of an option enforces the agreement and buys or sells a share of stock at the agreed-upon price,he is exercising the option.
• B)There are two kinds of options.European options allow their holders to exercise the option on any date up to and including a final date called the expiration date.
• C)Because an option is a contract between two parties,for every owner of a financial option there is also an option writer,the person who takes the other side of the contract.
• D)The price at which the holder buys or sells the share of stock when the option is exercised is called the strike price or exercise price.

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Definitions:

Expense Account

An account used to track money spent or costs incurred in the operation of a business, contributing to the overall expenses.

Owner's Capital

The total equity or financial contribution provided by the owner(s) of a business.

Prepaid Insurance

An asset account that represents payments made for insurance coverage before the coverage period.

Trial Balance

A bookkeeping worksheet in which the balances of all ledgers are compiled into debit and credit account columns to ensure accuracy.