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Consider the same basic facts as in P12-2, but instead of a forward contract Sue...

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Question

Accounting

Consider the same basic facts as in P12-2, but instead of a forward contract Sue purchases put options to sell 300,000
bushels at $5.20 per bushel. The options cost $0.05 a bushel.

REQUIRED
1 Determine the economic income of the sales transaction at various price levels at maturity for the option. Consider
market prices of $5.00, $5.10, $5.20, $5.30, and $5.40. Make a table similar to the Gre copper example

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