A company receives $102,000 when it issues a bond with a face value of $100,000 and a stated interest rate of 7%.Which of the following statements is true?
A) The annual interest expense is $7,000.
B) The market interest rate is 7%.
C) A contra account to bonds payable is not needed.
D) The face value of the bond on maturity will be $100,000.
Correct Answer:
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