JTC purchased call options on Flynn common shares on July 7, 2020, for $200 as a speculative investment. The call options give JTC the right to buy 100 shares at a strike price of $20 each. The options expire on January 31, 2021.

Thefollowing data is observed through 2020:

Flynn Stock Price Option Time Value

July 7, 2020 $20 $200

September 30, 2020 $25 $150

December 31, 2020 $23 $90

1. At September 30, 2020, the options are on JTC's balance sheet at a value of

a. $350

b. $500

c. $150

d. $650

2.In the fourth quarter (October - December) of 2020, JTC records a net

a.Loss

b. Gain

3. If JTC settles the options in January 2021 on a day when the stock price is $22, the settlement entry would include a debit to cash of

a.$200

b.$290

c.$2,000

d.$2,200

e. $110

4.In the third quarter (July to September) of 2020, JTC records a gain in intrinsic value of

a. $1,800

b. $150

c. $200

d. $350

e. $50

.

5. At September 30, 2020, the options are on JTC's balance sheet at a value of

a.$150

b.$1,950

c.$250

d.$350 .

6. At December 31, 2020, the options are on JTC's balance sheet at a value of

a.$260

b.$110

c.$90

d.$460

e.$490

f.$290

7.At September 30, 2020, the options are on JTC's balance sheet at a value of

a.$350

b.$1,950

c.$200

d.$150

.

8. In the fourth quarter (October - December) of 2020, JTC records a loss in time value of

a.$150

b.$60

c.$90

d.$110

.

9. At December 31, 2020, the options are on JTC's balance sheet at a value of

a.$260

b.$200

c.$350

d.$490

e.$460

f.$290

In January 2020, Bear Co. enters into a futures contract tobuy1,000 barrels of oil at $60 per barrel.Bear treats this as a speculative derivative. Subsequent prices are as follows.

Date Market Price of Oil

March 31, 2020 $67 per barrel

June 30, 2020 69 per barrel

September 30, 2020 55 per barrel

10.The first quarter (January - March) income statement includes a

(Loss or Gain) of ($2,000 or $67,000 or $7 or $7,000) related to the futures.

11.On the balance sheet at June 30, 2020, the futures are recognized asa(n)

(Not recognized, Asset or Liability)

12.The third quarter (July - September) income statement includes a(Loss or Gain) of

( $9,000 or $55,000 or $5,000 or $14,000)related to the futures.

13.On the balance sheet at September 30, 2020, the futures are recognized as a(n)

( Liability or Not recognized or Asset)

.