Question 32

On 3 August 2023, Sunny Smiles Ltd had a balance of $23,500 in their options account. This reflected 50,000 fully paid options which were on issue. Each option, if exercised, entitled the holder to purchase one ordinary share for $3, payable in full upon exercise of the option. When the options expired on 1 September 2023, 75% had been exercised. Options which were not exercised duly lapsed. After all transactions relating to the exercise of the options had been completed, what would the balance in Sunny Smiles Ltd's lapsed options reserve be?

		12500
		5875
		6250
		17625

Question 33

On 22 October 2027, the equity section of Courier Six Ltds balance sheet included the following: Share Capital Ordinary (50,000 fully paid shares) $100,000. Options (200,000 fully paid options) $20,000. Each option, if exercised, entitled the holder to acquire one ordinary share for $3.60, payable in full upon exercise of the option. By 1 November 2027, the exercise date of the options, 81% of the options were exercised. The remaining options duly lapsed. Once all of the options related transactions have been recorded , what will the balance of Courier Six Ltds share capital account be?

		692000
		699400
		583200
		683200

Question 34

On 15 January 2027, the equity section of Kratos Ltd's balance sheet included the following: Share Capital - Ordinary (100,000 fully paid shares) $500,000. Options (400,000 fully paid options) $80,000. Each option, if exercised, entitled the holder to acquire one ordinary share for $4.00, payable in full upon exercise of the option. By 1 February 2027, the exercise date of the options, 21% of the options were exercised. The remaining options duly lapsed.Which of the following would be one of the journal entries used to record the options related transactions?

		Dr Options 80 000 Cr Share Capital 80 000
		Dr Options 16 800 Cr Lapsed Options Reserve 16 800
		Dr Cash 352 000 Cr Share Capital 352 000
		Dr Cash 336 000 Cr Share Capital 336 000