A Discount on Bonds Payable

question 80

Multiple Choice

A discount on bonds payable:

• A) Occurs when a company issues bonds with a contract rate less than the market rate.
• B) Occurs when a company issues bonds with a contract rate more than the market rate.
• C) Increases the Bond Payable account.
• D) Decreases the total bond interest expense.
• E) Is not allowed in many states to protect creditors.

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Definitions:

Rapport

A harmonious relationship characterized by mutual understanding, trust, and respect between people.

Screen

a flat panel or area on an electronic device where images and data are displayed.

Audience

The group of people targeted or addressed by a communication, performance, or work of art, typically characterized by certain shared attributes or interests.

Unprepared

A state of not being ready or equipped to deal with a particular situation or task.