On October 15, 2019, Oil Products plc purchased 4,000 barrels of fuel oil with a cost of
Question:
Instructions
a. Prepare the journal entries of Oil Products for the following dates.
1. October 15, 2019-Oil Products purchases fuel oil and the put option on fuel oil.
2. October 31, 2019-Oil Products prepares financial statements.
3. November 30, 2019-Oil Products prepares financial statements.
4. December 31, 2019-Oil Products prepares financial statements.
b. Indicate the amount(s) reported on the statement of financial position and income statement related to the fuel oil inventory and the put option on November 30, 2019.
c. Indicate the amount(s) reported on the statement of financial position and income statement related to the fuel oil and the put option on December 31, 2019.
In finance, the strike price of an option is the fixed price at which the owner of the option can buy, or sell, the underlying security or commodity.
Step by Step Answer:
Intermediate Accounting IFRS
ISBN: 978-1119372936
3rd edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield