Allman,Inc

question 33

Multiple Choice

Allman,Inc. ,enters into a call option contract with Betts Investment Co.on January 2,2014.This contract gives Allman the option to purchase 1,000 shares of Upmann stock at $100 per share.The option expires on April 30,2014.Upmann shares are trading at $100 per share on January 2,2014,at which time Allman pays $200 for the call option.
-Using the information above,assume that the price of the Upmann shares has risen to $130 per share on March 31,2014,and the Hall is preparing financial statements for the quarter ending March 31.As regards this option,Hall,Inc. ,would report which of the following?

• A) A $30,000 realized gain
• B) A $30,000 unrealized gain
• C) A deferred gain of $29,800
• D) Nothing would be reported in the financial statements or the notes thereto.

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Definitions:

Infantile Amnesia

The relative paucity of autobiographical memories dating from before about 3 years of age.

Autobiographical Memories

Refers to a person's memories of their own life events and experiences, including both significant milestones and everyday events.

Central Details

The most important or essential pieces of information within a context or text.

Peripheral Details

Information that is not the central focus but can be found in the margins or periphery, often not the main point of attention.