Your company sells $50,000 of bonds for an issue price of $48,000.Which of the following statements is correct?

Question

Quizplus · Accepted Answer

The issue price is the amount that the bond is sold for and is usually expressed as a percentage of the bond's face value. In this case, the bonds sold for $48,000, which is 96% of their face value of $50,000. Since the issue price is less than 100%, the bonds are sold at a discount. The discount is equal to the difference between the face value and the issue price, which is $2,000. Therefore, choice D is correct.

Your Company Sells $50,000 of Bonds for an Issue Price