Response to the following questions:
1. Would a zero-coupon bond ever sell for its face amount?
2. Bonds Payable has a balance of $750,000, and Discount on Bonds Payable has a balance of $12,500. If the issuing corporation redeems the bonds at 99, is there a gain or loss on the bond redemption?
3. A business issued a 60-day, 8% note for $60,000 to a creditor on account.
Record the entries for
(a) the issuance of the note and
(b) the payment of the note at maturity, including interest.