The price of a bond is equal to the sum of the interest payments and the face amount of the bonds. True False

Q: ight-line method of amortization is used, the amount of unamortized premium on bonds payable will…

A: Amortization is the method of reducing or accounting for, an amount over a period of time. Over the…

Q: The price of a bond is the present value of promised future payments to the bondholder. A) True B)…

A: Bonds are units of securitized corporate securities that companies issue in the form of tradable…

Q: What is the excess of the issue price of bonds over their face amount called? premium discount…

A: Premium on Bonds: When bond market costs higher than its face value then bonds is called at premium.…

Q: what causes the bond liability for a bond issued at a premium to decrease each interest payment…

A: Bond premium is the premium which has been received by the company who has issued the bond by way of…

Q: Under what conditions of bond issuance does a discounton bonds payable arise? Under what conditions…

A:

Q: What are the total return, the current yield, and the capital gains yield for the discount bond?…

A: Total return of a discount bond is the difference between Maturity value and the issue price of the…

Q: The face value of a bond is O a. The amount payable at the maturity date. O b. The amount used to…

A: Face Value of Bond The face value or face amount of a bond payable is the amount printed on the…

Q: When the bond interest rate > the market rate, the bonds are issued at a discount. Select one: O…

A: Bond issued has fixed percentage of interest rate which is payable by bond issuer to bond holder.…

Q: A bond that pays interest forever and has no maturity date is a perpetual bond. How is the yield to…

A: Yield to maturity (YTM, y) of a perpetual bond mathematically derives its basis from the fact that…

Q: The return payable on Bond is called Select one: a. Commission b. Discount c. None of the options d.…

A: Value of a bond: Value of a bond is the present value of the future cash flows discounted at a…

Q: When the effective-interest method is used, the amount of bond discount amortized eachinterest…

A:

Q: If the market rate of interest is greater than the contractual rate of interest, bonds will sell a.…

A: Bonds: Bonds are a debt instrument on which interest is paid. They can be issued at a discount/par…

Q: interest payment for bonds is calculated using the face value of the bonds and the __________   A.…

A: Bonds payable are one of the sources of finance and are shown as liability. If the interest rate is…

Q: Which is true when a bond payable is issued at a discount? Proceeds from issuance is lower than the…

A: When the bonds are issued at a discount: Discount on bonds payable are debited at the time of…

Q: The total interest expense over the entire life of a bond is equal to the sum of the interest…

A: Bonds are issued by the company because it is it cheaper source of finance. It is because the…

Q: 4. When the market rate of interest is greater than the contract rate of interest, the bonds should…

A: Bonds are a form of debt or loan taken by the company, on which company has to make regular interest…

Q: iscuss the relationship between the market or effective interest rate of a bond and the stated…

A: The market value of a bond is inversely related to market rate of interest. If the Market interest…

Q: hen the effective cost of d

A: Cost of debts is the effective rate which is given by a company for paying on its debt.

Q: True or False: Bond issuers agree to pay interest to those who purchase bonds and hold them to…

A: Bonds are the long-term debt instruments used by governments and corporations to raise loan.

Q: effective interest technique

A: Bonds are the financial securities used to raise debt fund from public. They carry fixed interest…

Q: What is the difference between the stated interest rate andthe market interest rate on a bond?

A: Interest: It can be defined as the cost that is paid by the borrower for using the money borrowed…

Q: what is the principal amount repaid at the maturity of a bond is called?

A: Bond is a debt instrument which is issued by corporates or governments to raise funds for any…

Q: If the straight-line method of amortization of bond premium or discount is used, which of the…

A: Bond premium or discount arises at the time of issue of issue can be amortized by the two popular…

Q: The amount borrowed on a fixed-payment loan, the payments on the loan, and the yield to maturity.…

A: Comment- Since we only answer up to 3 sub-parts, we’ll answer the 3 parts. Please resubmit the…

Q: The amount loaned when a bond is issued is a. the principal. b. the dividend. c. its maturity.…

A: The amount loaned when a bond is issued is the principal.

Q: As the bond discount is amortized, the carrying value of the bonds will increase. True False

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: In theory, the proceeds from the sale of a bond will equal to the face amount of the bond. present…

A: Bonds payable are a form of liability for the business, on which regular interest payments need to…

Q: If bonds are issued at a discount and the effective-interest method is used, the amount ofinterest…

A: Bonds: Bonds are a kind of interest bearing notes payable, usually issued by companies,…

Q: ecarrying (book) value of a bond at the time when it is issued is always equal to its par valu True…

A: A bond may be issued at Par, at a premium or at discount. If the coupon rate of bonds is equal to…

Q: In theory, the proceeds from the sale of a bond will equal to the face amount of the bond. face…

A: Proceeds from sale of bonds implies cash received from issue of bonds. Theoretically it is…

Q: The carrying value of Bonds Payable equalsa. Bonds Payable plus Discount on Bonds Payable.b. Bonds…

A: Answer:   Option b

Q: Will the amortization of Discount on Bonds Payable result in a higher or lower Bond Interest…

A: Introduction: The amortization of discounts on bonds payable will increase interest costs. When…

Q: :When a bond sells at a discount, it means that The company was offering a higher price for the bond…

A: A bond is issued by the company to raise funds for the company.

Q: All of the following refer to the face rate of interest on a bond except: a. stated rate b.…

A: Face rate of interest is the rate of interest using which company calculates and pays its periodic…

Q: The effective interest technique is used to charge a discount on a bond that is due to be paid to…

A: The most effective approach to generating interest is... To amortize a bond over some time, the…

Q: If a company sells its bonds at more than face value, the effective interest rate is a. less than…

A: The answer for the multiple choice question and relevant explanation are presented hereunder :

Q: When the bond prices rise, interest rates fall.  True  FalsE

A: Bonds: Bond is a kind of debt instrument typically issued by corporations, government organizations…

Q: When a company uses the the effective-interest method to amortize a bond discount amortization, the…

A: As per effective interest method, there are two ways of recognizing the interest expense. first the…

Q: In theory, the proceeds from the sale of a bond will equal to the face amount of the bond. present…

A: Bond - it is fixed income investment in which investor park their money to the company and received…

Q: When a bond payable is measured using the fair value model, the interest expense is computed by…

A: Bonds can be defined as a financial instrument which provides regular interest income to its holder.…

Q: A bond that has only one payment, which occurs at maturity, defines which one of these types of…

A: One payment which occurs at maturity means only principle amount of bonds are refunded and no coupon…

Q: Which of the following statements concerning bonds is FALSE? A. Bonds can be issued either at par,…

A: Bonds are issued by the corporates as measure to raise funds for the business. unlike shareholders…

Q: When the initial present value of a bond payable is higher than its face amount, an entity would…

A: The answer is stated below:

Q: Refer to Chapter 10, page 567: Stated rate of interest versus the market rate of interest Required…

A: Bonds are a form of debt or liability being issued by the business, on which regular interest…

Q: A premium bond is a bond that sells for less than its par value. O True False

A: A bond can be a premium bond or a discount bond. This depends on the price of the bond at which it…