On January 3, Noel Ltd. purchases a call option for $1700 from Lucy Corp. to buy 1,000 Rerun Inc. shares at an exercise price of $50 per share. The option expires May 1. At this time the current market price of Rerun shares is also $50 On March 31 (Noel year end), the market value of the Rerun shares is $58 and the fair value of the option has increased to $14,000. On April 15, Noel takes delivery of (buys) the Rerun shares as agreed in the option contract. The market value of Quail's shares is now $60. Instructions (show any calculations) a. Calculate the intrinsic value and the time value of this option at 1. January 3 and 2. March 31

b. Prepare general journal entries for the following dates: 1. January 3 2. March 31 3. April 15