1.How would the recording of amortization of Discount on Bonds Payable affect the Carrying Value of the Bond and Net Income, respectively?

Select one:

a. Increase, Increase

b. Decrease, Decrease

c. Decrease, Increase

d. Increase, Decrease

e. No Effect, Increase

2.

For the issuer of a ten-year bond, the carrying value using the effective interest method would increase each year if the bond were sold at:

Select one:

a. A discount or a premium

b. A discount, but not a premium

c. A premium, but not a discount

d. Neither a discount nor a premium