2. 13.1 What is the difference between serial bonds and term bonds?
3. 13.1 What is a junk bond?
4. 13.1 How are savings bonds different from a corporate bond?
5. 13.1 What do you have to do to the interest rate and years of maturity if a bond pricing problem tells you
that interest is compounded quarterly?
6. 13.2 An amortization table/schedule is created to compute the amount to be amortized each year. What
are the four columns needed to prepare the table?
7. 13.2 In the amortization table, how is the amortization of discount of premium computed?
8. 13.2 Does issuing a bond at a discount increase or decrease interest expense over the life of the bond?
9. 13.2 What kind of account is the Discount on Bonds Payable? What kind of account is the Premium on
Bonds Payable?
10. 13.2 Why is the effective-interest method of amortization required under the International Financial
Reporting Standards?
11. 13.3 If there is neither a premium nor discount present, the journal entry to record bond interest
payments is _______.
12. 13.3 When do you use the Bond Discount Account?
13. 13.3 A company issued bonds with a $100,000 face value, a 5-year term, a stated rate of 6%, and a
market rate of 7%. Interest is paid annually. What is the amount of interest the bondholders will receive at the
end of the year?
14. 13.3 A company issued $100,000, 5-year bonds, receiving $97,000. What is the balance sheet
presentation immediately after the sale?
15. 13.3 Does interest expense increase or decrease when a bond premium is amortized?