Corine Ltd,a Trader Bought a December Put Option for 10 $\quad \$ 4500$

question 2

Multiple Choice

Corine Ltd,a trader bought a December put option for 10 $100 000 10% treasury bonds at a premium of $3.95 on January 1,2010.Year end for Corine is 30 June when the price for a December put option for $100 000 10% treasury bonds is $3.50.
What would be the journal entry for 30 June 2010?

• A) Dr Loss on options contract \(\quad \$ 4500\)
• \(\mathrm { Cr }\) Investment in options contract\(\quad\$ 4500\)
• B) \(\begin{array} { l l l }
• \text { Dr Loss on options contract } & \$ 450 & \\
• \text { Cr Investment in options contract } & & \$ 450
• \end{array}\)
• C) Dr Investment in options contract \(\quad \$ 4500\)
• \(\mathrm { Cr }\) Gain on options contract\(\quad\$ 4500\)
• D) Dr Investment in options contract \(\quad \$ 450\)
• \(\mathrm { Cr }\) Gain on options contract\(\quad\$ 450\)

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Definitions:

Push Strategy

A marketing approach that involves taking the product directly to the customer via whatever means to ensure the customer is aware of your brand at the point of purchase.

Supply Chain

A system of organizations, people, activities, information, and resources involved in moving a product or service from supplier to customer.

Physical Distribution

The activities concerned with the efficient movement of products from the producer to consumers, including storage and transportation.

Supply Chain Management

The oversight of materials, information, and finances as they move from supplier to manufacturer to wholesaler to retailer to consumer.