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) $\begin{array} { l r r } \text { Dr Cash at Bank } & \$ 40000 & \\\text { Cr Gain on options contract } & \$ 5000 \\\text { Cr Investment in options } & \$ 35000\end{array}$
B) $\begin{array} { l r r } \text { Dr Cash at Bank } & \$ 40000 & \\\text { Cr Gain on options contract } & \$ 500 \\\text { Cr Investment in options } & \$ 39500\end{array}$
C) C) Dr Investment in options $\quad\$ 35000$
Dr Loss on options contract $\quad\$ 5000$
Cr Cash at Bank $\quad\$ 40000$
D) $\begin{array} { c r r } \text { D) Dr Investment in options } & \$ 39500 & \\\text { Dr Loss on options contract } & \$ 500 & \\\text { Cr Cash at Bank } & & \$ 40000\end{array}$