Lakeland Company had a $10,000,000 bond issue sold at 98. Which of the following statements must be true regarding this bond issue?

Multiple Choice

Sold at a discount because the effective interest rate was lower than the face rate.

Sold at a premium because the stated rate of interest was higher than the yield rate.

Sold for the $10,000,000 face amount less $200,000 of accrued interest.

Sold at a discount because the stated rate of interest was lower than the effective rate.