Concerning options, which of the following is the most correct statement:
A: An option may be resold by the optionor at any time before the optionee exercises the right to purchase;
B: If a lease contains an option to purchase, this right ordinarily will pass with an assignment of the lease, even though such option is not specifically mentioned in the assignment of the lease;
C: An option as a contract is distinguished from other contracts in that an option must have mutuality of rights and obligations;
D: An option contract creates a fiduciary relationship between the optionor and the optionee very similar to the fiduciary relationship between a broker and principal.
Answer: B: If a lease contains an option to purchase, this right ordinarily will pass with an assignment of the lease, even though such option is not specifically mentioned in the assignment of the lease;
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Alexa Company issued 5-year, 7% bonds with a par value of $100,000. The company received $97,947 for the bonds. Using the straight-line method, the amount of interest expense for the first semiannual interest period is:
A) $3,294.70. B) $3,500.00. C) $3,705.30. D) $7,000.00. E) $7,410.60.
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Indicate whether the statement is true or false