Merry Ltd., a publicly accountable enterprise, paid $250 for the option to buy 1,000 of its common
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Instructions
(a) Provide the journal entry required to account for the purchase of the call option.
(b) Assume that the contract allows both parties a choice to settle the option by either exchanging the shares or settling
on a net basis. Would this change your conclusion in part (a)?
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Related Book For
Intermediate Accounting
ISBN: 978-0470161012
9th Canadian Edition, Volume 2
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield.
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