The following information pertains to the next four questions. On January 1, 2019, Baker Company issued a $10,000 face value bond that sold for 92. The bond had an eight-year term and with a coupon (stated) rate of 4% annual interest. The company uses the straight-line method of amortization.

1.The carrying value of the bond liability on January 1, 2019, would be

a. $6,800.

b. $9,000.

c. $9,200.

d. $10,000.

2.The amount of interest expense reported on the 2019 income statement would be a. $368.

b. $400.

c. $500.

d. $800.

3.Interest expense reported on the income statement over the life of the bond would

a. increase by $100 each year.

b. be the same each year.

c. decrease by $100 each year.

d. not be determinable on January 1, 2019.

4.The carrying value of the bond liability on December 31, 2020 is expected to be

a. $10,000.

b. $ 9,200.

c. $ 9,300.

d. $ 9,400.