Answer: B) The option premium is greater or equal to its intrinsic value because of the time premium.
Explanation:
The option premium can be calculated by adding the time premium and the intrinsic value. The time premium is the part of the option premium that accounts for the time remaining till the premium matures while the intrinsic value is the difference between the value of underlying asset and the strike price.
As the time premium can be zero but never negative, the option premium can either be greater than its intrinsic value or equal to it. It cannot be lower than it because of the time premium.
Answer:
Mathis Co.
The Tax payable for 2020 is:
= $1,320,000
Explanation:
a) Data and Calculations:
2020 Financial income = $1,200,000
add Litigation expense 3,000,000
add installment sales 2,400,000
Adjusted taxable income $6,600,000
Income tax rate = 20%
Tax payable for 2020 = $1,320,000
b) The litigation expense was deducted from the financial income. This is added back to the income. Installment sales were not included in the revenue for the financial income of 2020. This is also added to the financial income. The net result is the figure for taxable income. This forms the basis for the application of the income tax rate of 20%.
Answer:
Willie should report this item on his 2019 and 2020 tax returns as 2019—$0 ; 2020—$6,000 long-term capital loss.
Explanation:
In year 2020, the loss of $6,000 is classified as a $6,000 long term capital loss because the stock is not § 1244 stock to Willie.
Therefore, Willie should report this item on his 2019 and 2020 tax returns as 2019—$0 ; 2020—$6,000 long-term capital loss.
Since the problem doesn’t give the choices for these questions. I will be giving you the factors that affect the elasticity:
1. Labor costs as percent of total costs – when labor expenses have a high share in total costs then labor demand is more elastic.
2. Easiness and cost of factor substitution – when the firm can substitute rapidly and effortlessly between labor and capital inputs.
3. Price elasticity of demand for the final output produced – if the business is working an extremely competitive market where the final demand of the product is elastic and as a result the demand for labor is more elastic.
Every corporation needs to recor a dividen-related liability on the declaration date. Have in mind that t<span>he </span>declaration date<span> is the </span>date<span> on which the next dividend payment is announced by the directors of a company.</span> In that date all the limited liability corporations do those records. A target corporation is not a limited liability corporation.
