On December 15, 2009, Chippy , Inc. purchased an option for P50,000 to buy 100,000 kilos of Jumbo potatoes at a strike price of P30 per kilo. The intrinsic value of the option was designated as a cash...

On December 15, 2009, Chippy , Inc. purchased an option for<br>P50,000 to buy 100,000 kilos of Jumbo potatoes at a strike price of<br>P30 per kilo. The intrinsic value of the option was designated as a<br>cash flow hedge. The following fair values were relevant.<br>12/15/09<br>12/31/09<br>Fair value of Jumbo potatoes<br>in the commodity market<br>Fair value of option in the<br>derivative market<br>6) What is the total amount that should be taken into profit or loss?<br>P 30<br>P 32<br>P50,000<br>P 230,000<br>a. РО<br>b. P 180,000 gain<br>C. P 20,000 loss<br>d. P 200,000 gain<br>

Extracted text: On December 15, 2009, Chippy , Inc. purchased an option for P50,000 to buy 100,000 kilos of Jumbo potatoes at a strike price of P30 per kilo. The intrinsic value of the option was designated as a cash flow hedge. The following fair values were relevant. 12/15/09 12/31/09 Fair value of Jumbo potatoes in the commodity market Fair value of option in the derivative market 6) What is the total amount that should be taken into profit or loss? P 30 P 32 P50,000 P 230,000 a. РО b. P 180,000 gain C. P 20,000 loss d. P 200,000 gain

Jun 07, 2022

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On December 15, 2009, Chippy , Inc. purchased an option for P50,000 to buy 100,000 kilos of Jumbo potatoes at a strike price of P30 per kilo. The intrinsic value of the option was designated as a cash...

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