Corine Ltd,a Trader Bought a December Put Option for 10 $\$ 100000$

Corine Ltd,a trader bought a December put option for 10 $100 000 10% treasury bonds at a premium of $3.95 on January 1,2010.Year end for Corine is 30 June when the price for a December put option for $\$ 100000$ 10% treasury bonds is $3.50.On 31 July 2010,Corine Ltd sold the option for $4.00.What are the journal entries to record this transaction?

A)
$\begin{array} { l l l } \text { Dr } & \text { Cash at Bank } & \$ 40000 \\\text { Cr } & \text { Gain on options contract } & \$ 5000 \\\text { Cr } & \text { Investmentin options } & \$ 35000\end{array}$

B)
$\begin{array} { l l l } \text { Dr } & \text { Cash at Bank } & \$ 40000 \\\text { Cr } & \text { Gain on options contract } & \$ 500 \\\text { Cr } & \text { Investmentin options } & \$ 39,500\end{array}$


C)
C)
$\begin{array}{l}\begin{array}{ll}\text { Dr Investment in options } & \$ 35000 \\\text { Dr Loss on options contract } & \$ 5000\end{array}\\\text { Cr Cashat Bank }&\$ 40000\end{array}$

D)
$$\begin{array} { c r r } \text { Dr Investment in options } & \$ 39500 & \\\text { Dr Loss on options contract } & \$ 500 & \\\text { Cr } \quad \text { Cash at Bank } & & \$ 40000\end{array}$$