On January 1, 2022, Rosewood Corp. purchased a put option on shares of ICM stock. Terms of the contract were as follows:

• Number of shares: 100
• Strike price: $240 per share
• Expiration date: May 31, 2022
• Total cost of the option contract: $110
• Seller of the option contract: First Investment Bank

On January 1, 2022, ICM stock was trading at $240 per share. The following additional information is known:

• On March 31, 2022, the price of ICM stock was $210 per share. A market appraisal indicated that the time value of the option contract was $90.
• On May 10, 2022, the price of ICM stock was $215 per share. A market appraisal indicated that the time value of the option contract was $80. On this date, Rosewood settled the option contract.

Required: 1. Prepare the appropriate journal entry or entries related to transactions occurring in January 2022 through March 2022. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 2. Indicate any amounts that Rosewood Corp. would have included in its March 2022 quarterly financial statements related to the option contract. 3. Prepare the appropriate journal entry or entries related to settlement of the option in May 2022. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

1. Jan. 1, 2022: Record purchase of the option contract.

2. March 31, 2022: Provide any journal entry needed to update the intrinsic value of the option contract.

3. March 31, 2022: Provide any journal entry needed to update the time value of the option contract.

Indicate any amounts that Rosewood Corp. would have included in its March 2022 quarterly financial statements related to the option contract.

Balance Sheet (current assets):
Income Statement (partial):
Net gain (unrealized, NI):

Prepare the appropriate journal entry or entries related to settlement of the option in May 2022.

1. May 10, 2022: Provide any journal entry needed to update the intrinsic value of the option contract.

2. May 10, 2022: Provide any journal entry needed to update the time value of the option contract.

3. May 10, 2022: Provide the journal entry for settlement of the option contract (assume cash settlement).