1. Which of the following statements is true of a bond that is issued at a premium?
A) It will be sold above par.
B) Its stated interest rate is lower than the prevailing market rate.
C) It will repay a greater amount than the face value at maturity.
D) It will be sold at par.
2. After a firm determines an asset’s useful life and salvage value, can they be changed? Explain
3. For a long-lived operating asset acquired by issuing a note payable, do firms measure the initial carrying value of the asset by the face value of the note? Explain.