The company offered its investors option contracts to buy their shares at P72 with the current price of P90. They were only given 90 days to exercise their rights. 52 week-high for the stock is P95 while the 52-week low is P70. The T-bill rate is 7.32%.
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What is the value of Nd1?
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- The company offered its investors option contracts to buy their shares at P72 with the current price of P90. They were only given 90 days to exercise their rights. 52 week-high for the stock is P95 while the 52-week low is P70. The T-bill rate is 7.32%. REQUIRED: Value of Nd1. (Use 4 decimal places) Value of Nd2. (Use 4 decimal places) Volatility rate. (Use percentage and at least, two decimal places) Value of the call option. (Use two decimal places) Value of the put options. (Use two decimal places)The company offered its investors option contracts to buy their shares at P72 with the current price of P90. They were only given 90 days to exercise their rights. 52 week-high for the stock is P95 while the 52-week low is P70. The T-bill rate is 7.32%. REQUIRED: Value of Nd1. (Use 4 decimal places) ANS: 0.9991 Value of Nd2. (Use 4 decimal places) ANS: 0.9990 Volatility rate. (Use percentage and at least, two decimal places) ANS: 15.78% Value of the call option. (Use two decimal places) Value of the put options. (Use two decimal places)The company offered its investors option contracts to buy their shares at P72 with the current price of P90. They were only given 90 days to exercise their rights. 52 week-high for the stock is P95 while the 52-week low is P70. The T-bill rate is 7.32%. 1. What is the value of Nd1 and Nd2? (Use 4 decimal places) 2. What is the volatility rate? (Use percentage and at least, two decimal places) 3. What is the value of the call option and put options? (Use two decimal places)
- Aylmer Inc paid $520 for a call to purchase 850 shares of Belmont Inc on April 1, Y3.The strike price was $26.50 per share and could be exercised anytime in the next 6 months.On April 1, Y3, the market price for one share of Belmont Inc. was $29.30. Belmont's stock price rose. On June 30, Y3, the price for Belmont stock was $31.55 per share.The fair value of the option on June 30, Y3 was $7,365. REQUIRED Prepare the appropriate entries under two different scenarios: 1) Aylmer exercised the option 2) Aylmer did not exercise the option (just the June 30th entry)Aylmer Inc paid $520 for a call to purchase 850 shares of Belmont Inc on April 1, Y3.The strike price was $26.50 per share and could be exercised anytime in the next 6 months.On April 1, Y3, the market price for one share of Belmont Inc. was $29.30.Belmont's stock price rose. On June 30, Y3, the price for Belmont stock was $31.55 per share.The fair value of the option on June 30, Y3 was $7,365. REQUIRED Prepare the appropriate entries under two different scenarios:1) Aylmer exercised the option2) Aylmer did not exercise the option (just the June 30th entry)Eight months ago, the Zeus Fund entered into a short position in a one - year forward contract on 1,250 shares of Cerner Corporation stock at a forward contract price of $94 per share. Today, the price of Cerner stock is $92.50 per share and the interest rate for continuous compounding is 1 % . Cerner stock does not pay dividends. If the Zeus Fund wanted to exit the contract today, how much should it be willing to pay, or how much should it expect to receive, from its counterparty?
- Holder Ltd. purchases an options contract from Issuer Ltd. that gives Holder Ltd. the right to acquire 100,000 options in Torquay Ltd. for a price (exercise price) of $ 10.00 per share. When the contract was exchanged the price of Torquay Ltd. shares was $ 9.00 each. The option entitles Holder Ltd. to exercise the options and buy the shares any time within the next six months. If the options are not exercised within the six month period, then the options will expire. Need the answers to the followings; Determine whether a financial liability or financial asset exists from the perspectives of Holder Ltd. and Issuer Ltd. Further, if the price of shares in Torquay Ltd. falls to $ 5.00, with the result that it is improbable that Holder Ltd. will ever exercise the options, will this change the classification of the options as either financial assets or financial liabilities?On January 2, 2020, Ayayai Company purchases a call option for $310 on Merchant common stock. The call option gives Ayayai the option to buy 1,090 shares of Merchant at a strike price of $49 per share. The market price of a Merchant share is $49 on January 2, 2020 (the intrinsic value is therefore $0). On March 31, 2020, the market price for Merchant stock is $53 per share, and the time value of the option is $200. Prepare the journal entry to record the purchase of the call option on January 2, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Jan. 2, 2020 enter an account title to record the transaction on January 2, 2020 enter a debit amount enter a credit amount enter an account title to record the transaction on January 2, 2020 enter a debit…Hua Xin Services offered an incentive stock option plan to its employees. On January 1, 2024, options were granted for 90,000 $1 par common shares. The exercise price equals the $5 market price of the common stock on the grant date. The options cannot be exercised before January 1, 2027, and expire December 31, 2028. Each option has a fair value of $1 based on an option pricing model. What is the total compensation cost for this plan?
- On July 14, an investor goes short on a put option for 100 shares of ABC Corporation common stock with a strike price of ₱9 with an expiration date of August 16, at an option premium of ₱1.50 per share. The market price of ABC on July 14 is ₱8. On August 16, the market price of ABC is ₱6. How much has the investor gained or lost on the option transaction? Disregard any brokerage commissions involved.Eight months ago, the Zeus Fund entered into a short position in a one-year forward contract on 1,250 shares of Cerner Corporation stock at a forward contract price of $94 per share. Today, the price of Cerner stock is $92.50 per share and the interest rate for continuous compounding is 1%. Cerner stock does not pay dividends. What is today’s market value of the forward contract? If the Zeus Fund wanted to exit the contract today, how much should it be willing to pay, or how much should it expect to receive, from its counterparty?BCD Company offer its investors option contracts to buy their shares at a price of P50. Currently, the value of their stocks in the market stands at P60. The 52-week high of the share price is P83 and its 52-week low is P47. The treasury bill issued by the government yields 8.25% currently. What’s the probability for the up move?