A Bond Is Issued at Par Value When

question 147

Multiple Choice

A bond is issued at par value when:

• A) Straight line amortization is used by the company.
• B) The bond pays no interest.
• C) The bond is callable.
• D) The bond is not between interest payment dates.
• E) The market rate of interest is the same as the contract rate of interest.

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Definitions:

Unadjusted Trial Balance

A summary listing of the titles and balances of accounts in the ledger prior to the posting of adjusting entries.

Account Title

The name given to an account in the ledger to identify the type of transactions it records, such as "Sales Revenue" or "Accounts Payable."

Unearned Revenues

Money received by a company for goods or services that have yet to be delivered or performed.

Current Assets

Resources that are anticipated to be turned into cash, disposed of, or utilized within a year or throughout the regular business cycle.