by R. Venkata Subramani | Dec 17, 2008 | 08 - Call Options
The accounting treatment of call options prima facie will depend upon the intention with which the call options are purchased—hedging or speculation (nonhedging). If the position is taken as a hedge against some other position, then the relevant accounting standards...
by R. Venkata Subramani | Dec 8, 2008 | 08 - Call Options
Journal Questions Mr. Berkowitz buys 1,000 equity call options of Normal Electricals for $4 per share for a strike price of $25 on June 12, expiry date being July 16. Brokerage is 0.25 percent and is settled on T + 2 basis. Pass necessary journal entries for the...
by R. Venkata Subramani | Dec 8, 2008 | 08 - Call Options
Objective Questions 1. Accounting standard FAS 133 applies to a. Accounting for certain investments in debt and securities. b. Accounting for derivative instruments and hedging activities. c. Fair value measurements. d. None of the above. 2. Premium paid towards...
by R. Venkata Subramani | Dec 8, 2008 | 08 - Call Options
Theory Questions 1. Explain the trade life cycle for call options. 2. Is accounting for call options any different if the options were to be held as hedge and not as investment?
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