Choice "D" is correct. When debt is issued at a discount, interest expense over the term of the debt equals the cash interest paid plus amortization of the discount. The Journal Entry for the amortization of the discount is as follows:

An easy way to remember whether to add or to subtract is that the discount is a reduction (Dr) of the bond's face value or par amount (Cr). Since the discount is a debit, the way to reduce (amortize) it is to credit it.Choice "b" is incorrect. When debt is issued at a discount, interest expense over the term of the debt equals the cash interest paid plus, not minus, amortization of the discount.
Choice "a" is incorrect. When debt is issued at a discount, interest expense over the term of the debt equals the cash interest paid plus amortization of the discount. The par value should definitely not be subtracted.
Choice "c" is incorrect. When debt is issued at a discount, interest expense over the term of the debt equals the cash interest paid plus amortization of the discount. The par value should definitely not be added.