1.One of the main factors that influences the decision to issue debt or equity is the effect that various financing alternatives will have on

a. EPS. b. net Income. c. interest expense. d. All of these choices are correct.

2. If bonds with a face value of $50,000 are issued at 95, what amount would they be issued for?

a.$52,500 b.$50,095 c.$47,500 d.$95

3. If Interest on bonds of $4,500 is paid semi-annually for 10 years, what is the total cost of borrowing $150,000?

a.$90,000 b.$45,000 c.$105,000 d.$60,000

4. Which of the following is not used to calculate the amount of interest to be paid on bonds?

a.Stated interest rate b.Face value c.Maturity date d.Market value

5. When bonds are issued at a discount, the carrying value of the bond is:

a.The face value less discount on bonds payable

b.The face value plus discount on bonds payable

c.The face value

d.None of these choices are correct.