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could you please help me solve this On January 1, 2025, Mills Corp. purchased a call option on shares of XYZ stock. Terms of the
could you please help me solve this
On January 1, 2025, Mills Corp. purchased a call option on shares of XYZ stock. Terms of the contract were as follows: - Number of shares: 100 - Strike price: $160 per share - Expiration date: April 30,2025 - Total cost of the option contract: $110 - Seller of the option contract: First Investment Bank On January 1, 2025, XYZ stock was trading at $160 per share. The following additional information is known: - On March 31. 2025 , the price of XYZ stock was $180 per share. A market appraisal indicated that the time value of the option contract was $90 - On ARril 5.2025, the price of XYZ stock was $175 per share. A market appraisal indicated that the time value of the option contract was $80. On this date, Mills settled the option contract. Required: 1. Prepare the appropriate journal entry or entries related to transactions occurring in January 2025 through March 2025 . Uf no entry is required for a transaction/ovent, select "No journal entry required" in the first account field.). 2. Indicate p. would have included in its. March 2025 quarterly financial statements related to the option 3. Prepare the appropriate journal entry or entries related to settlement of the option in April 2025. (If no entry is required for a contract. 3. Prepare the appropriate journai entry or entries related to settlement of the option in April 2025. (If no entry is required for a ransaction/event, select "No joumal entry required" in the first account field.) Complete this question by entering your answers in the tabs below. Prepare the appropriate journal entry or entries related to settiement of the option in April 2025. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Step by Step Solution
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