A trader buys a call option with a strike price of $30 for $3. Does the trader ever exercise the option and lose money on the tr
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The answers for the subdivisions are given below and are explained. Explanation:
1)
it consists of a table refer the attachment
it has the list of asserts, liabilities and common stock
2)
(i) 32000
(ii) 11000
(iii) 38000
3)
The table in attached, it explains the prepaid expenses , common stock , dividends , insurance expenses , Insurance expenses, Accounts payable, service revenue.
4)
Refer the tables are attached it explains the Accounts receivable, common stock, rent payable. insurance expense , interest revenue and dividends.
5)
1.Equity at the beginning of the year = 27000 - 15000 = 8000
2. Equity at the end of the year 60,000 - 27,000 = 33000
3. Increase in equity = 33000 - 8000 = 25000
Net Income = 25000 + 37300 - 6300 = 56000
4. Common stock = 25000 + 6000 - 1100 = 29900
5. Dividends = 19600 + 19100 - 25000 = 13700
6. Net Income = 25000 + 42900 - 3400 = 64500
