1. When the effective yield of a bond is the same as the coupon rate on the bond, the bond is sold at a. a discount. b. a premium. c. par. d. a price above par. 2. Theta Company has prepared to sell bonds with a coupon rate of 8% when the market rate is 7%. The sell in the market at a. par. b. a discount c. a premium. d. stated value. 3. Which of the following statements is correct? -a. Amortization of discount on bonds payable results in a decrease in a bond's carrying (book) value. b. Amortization of discount on bonds payable results in a decrease in bond interest expense. c. Amortization of premium on bonds payable results in a decrease in a bond's carrying (book) value. d. Amortization of premium on bonds payable results in an increase in bond interest expense. 4. When computing the issue price of a bond that has a coupon rate of 8% payable semiannually and a mi 10%, the discount rate used would be a. 8%. b. 10%. c. 4%. d. 5%. 5. If a company issues 1,000 shares of common stock at a market price of $20 per share, which of the fol correct balance sheet effect? a. Increase cash by $20,000 and increase contributed capital by $20,000 b. Increase cash by $20,000 and increase earned capital by $20,000 c. Increase stock revenues by $20,000 d. Stock issuances are not reported on the balance sheet