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Carl Daver, your anatomy and physiology instructor, is conducting a field trip, and notices a dog approaching a fire hydrant. Always alert to instructional opportunities, he excitedly says, "Now watch as the dog utilizes his _____ and _____ muscles to lift his leg."
Discounted Bond
A bond sold for less than its face value due to prevailing interest rates being higher than the bond's coupon rate.
Amortized
The process of gradually writing off the initial cost of an asset over a period of time or spreading out a loan payment.
Discount on Bonds Payable
The difference between the bonds' par (or face) value and their lower selling price, representing additional interest expense to the issuer over the term of the bonds.
Bond Interest Payable
A liability account that records the amount of interest due on bonds that have not yet been paid to bondholders.
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