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PolarNik [594]
3 years ago
11

Suppose you believe that basso inc.'s stock price is going to increase from its current level of $22.50 sometime during the next

5 months. for $3.10 you can buy a 5-month call option giving you the right to buy 1 share at a price of $25 per share. if you buy this option for $3.10 and basso's stock price actually rises to $45, what would your pre-tax net profit be?
Business
1 answer:
JulijaS [17]3 years ago
6 0

The pre-tax net profit can be calculated using the formula:

Net Profit = Final Stock Price – Buying Cost – Option Cost

Substituting the given values into the equation will result in:

Net Profit = $45 - $25 - $3.10

<span>Net Profit = $16.90</span>

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Max and Eli both graduated from the police academy. Max chose to work in a large city with high crime rates, while Eli chose a j
Rina8888 [55]

Answer: Compensating differentials.

Explanation:

Compensating differential is the additional amount of money that a worker is given in order to motivate the worker to accept an undesirable job. Compensating differentials is as a result of the risk of injury, risk of future unemployment, risk of unsafe environment and it explains why there is difference in pay between different regions

Even though Max and Eli have the same skill and are members of the same trade union, Max is paid higher than Eli because Max works in an area with high crime rate while Eli's area has a low crime rate. Thus, Max higher is expected because the cost of living is higher in a city and also due to higher crime rates which means he's likely to work mire than Eli.  

5 0
3 years ago
Read 2 more answers
1. Describe the value of an education.
Colt1911 [192]

Well you need an education to get a job and make money to survive, if you want to lets say work at a fast food place then you need to know math, and ALGEBRA to combine foods and stuff. If you want to be a reporter then you'll need to know English language arts. Basically you'll need an education for any job you get.

4 0
3 years ago
The following transactions involving intangible assets of Minton Corporation occurred on or near December 31, 2017. 1. Minton pa
kvv77 [185]

Answer and Explanation:

As per the data given in the question,

The journal entries are shown below:

A. On the date of transaction

1. Franchise A/c Dr. $400,000

          To Cash Cr. $400,000

(Being cash paid is recorded)

2. Research and development expense A/c Dr. $600,000

              To Cash Cr. $600,000

(Being cash paid is recorded)

3. Patents A/c Dr. $180,000

            To Cash Cr. $180,000

(Being cash paid is recorded)

4. Patents A/c Dr. $140,000

          To Cash Cr. $140,000

(Being cash paid is recorded)

5. Legal fees expense A/c Dr. $480,000

        To Cash Cr. $480,000

(Being cash paid is recorded)

6. Patents expense A/c Dr. $252,000

        To Patents Cr. $252,000

(Being patent expense is recorded)

7. Research and development expense $104,000

            To Cash Cr. $104,000

(Being cash paid is recorded)

B. Journal entries on Dec-31, 2018

1. No journal entry is needed

2. No journal entry is needed

3. Amortization expense A/c Dr. $18,000

             To Patents Cr. $18,000

(Being the amortization expense is recorded)

4. Amortization expense $35,000 ($140,000 ÷ 4 years)

             To Patents Cr. $35,000

(Being the amortization expense is recorded)

5. No journal entry is needed

6. No journal entry is needed

6 0
3 years ago
Tom elects the Life Income with 10-year Period Certain settlement option. Tom dies in year 6. The beneficiary receives payments
Sonbull [250]

Answer:

B. 4 years

Explanation:

As per the certain life income period, the guaranteed payments for the recipient lifetime or the specified time duration whichever is more.

Now if the recipient dies before the certain period ended, so the payments would be continued to the other beneficiary unless there is an end for the certain period

So, in the given situation, the payments would be received for

= 10 years - 6 years

= 4 years

Hence, the correct option is B. 4 years

6 0
3 years ago
Free Motion Enterprises paid a $2.20 per share annual dividend last week. Dividends are expected to increase by 3.75 percent ann
Tems11 [23]

Answer:

$20.29

Explanation:

The computation of the today share price is shown below:

= Next year dividend ÷ (Required rate of return - growth rate)

where,

Next year dividend

= $2.20 + $2.20 × 3.75%

= $2.20 + 0.0825

= $2.2825

The other items values would remain the same

So, the today price would be

= $2.2825 ÷ (15% - 3.75%)

= $2.2825 ÷ 11.25%

= $20.29

6 0
3 years ago
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