The market rate of interest for a bond issue which sells for more than its face value is

Less than the interest rate stated on the bond.

Independent of the interest rate stated on the bonds.

Higher than the interest rate stated on the bond.

Equal to the interest rate stated on the bond.

If the company issues a $100000 12% 10-year bond that pays interest semiannually when market interest rate is 10% the bond would sell
at an amount

greater than face value.

equal to face value.

that can not be determined based on the information given.

less than face value.

If a corporation issued $2000000 in bonds which pay 10% annual interest what is the annual net cash cost of this
borrowing if the income tax rate is 30%?

$140000

$2000000

$60000

$200000

If a corporation issued $5000000 in bonds which pay 10% annual interest what is the annual net
cash cost of this borrowing if the income tax rate is 30%?

$500000.

$5000000.

$350000.

$150000.

On January 1 Hurley Corporation issues $1000000 5-year 12% bonds at 96
with interest payable on July 1 and January 1. The entry on December 31 to
record accrued bond interest and the amortization of bond discount using the
straight-line method will include a

debit to Interest Expense $120000.

credit to Discount on Bonds Payable $4000.

debit to Interest Expense $60000.

credit to Discount on Bonds Payable $8000.

On January 1 Hurley Corporation issues $500000 5-year
12% bonds at 96 with interest payable on July 1 and January
1. The entry on July 1 to record payment of bond interest
and the amortization of bond discount using the
straight-line method will include a:

credit to Discount on Bonds Payable
$2000.

debit to Interest Expense $30000.

debit to Interest Expense $60000.

credit to Discount on Bonds Payable
$4000.

On January 1 Hurley Corporation issues
$500000 5-year 12% bonds at 96 with
interest payable on July 1 and January
1. What is the carrying value of the
bonds at the end of the third interest
period?

$472000.

$486000.

$464000.

$488000.

PLEASE BE SURE OF
THE ANSWERS AND
PROVIDE SOLUTION
FOR EACH SO THAT I
CAN UNDERSTAND.