8. Bonds that are payable over a period of years are called: A. Callable bonds. B. Serial bonds. C. Coupon bonds. D. Bearer bonds.

9. What is the straight-line method for amortizing bond discount or premium? A. Same amount of amortization is taken each period B. An increasing amount of amortization is recorded each period C. Decreasing amount of amortization is taken each period D. Large amount of amortization taken in first year followed by same amount in the remainder of the years

10. The entry to record the issuance of bonds includes a: A. Debit to Bonds Payable. B. Credit to Bonds Payable. C. Credit to Bond Interest Payable. D. Debit to Bond Interest Payable.

11. If bonds are issued for a price below their face value, the bond discount is: A. Debited to expense on the date the bonds are issued. B. Amortized over the life of the bond issue. C. Shown as an addition to bonds payable in the Long-Term Liabilities section of the balance sheet. D. Shown as a deduction to bonds payable in the Current Liabilities section of the balance sheet.

12. What is a bond sinking fund investment? a. An investment that is decreasing in value b. A liability c. An asset d. Part of Bonds Payable (contra account)

13. The entry to record income earned by a bond sinking fund investment includes a credit to: A. Bonds Payable. B. Bond Sinking Fund Investment. C. Income from Sinking Fund Investment. D. Interest Income.

14. What item serves as the base for the percentage calculations in a vertical analysis of the income statement? A. Total Sales B. Net Sales C. Net Income D. GrossProfit

15. Which of the following is true of vertical analysis? A. Each item on the balance sheet is expressed as a percentage of total liabilities. B. Each item in the income statement is divided by net sales. C. Each item in the income statement is expressed as a percentage of net income. D. The amount of increase or decrease for each item in the income statement is divided by net sales.