With the Effective Interest Method of Amortization, the Amortization of a Bond

question 23

Multiple Choice

With the effective interest method of amortization, the amortization of a bond premium results in a(n)

• A) increase in liabilities.
• B) decrease of stockholders' equity.
• C) increase in interest expense.
• D) decrease in interest expense.

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Definitions:

Protons

Protons are positively charged subatomic particles found within the nucleus of an atom and contribute to the atom's overall charge and mass.

Orbiting

The act of one object moving around another in a path called an orbit, due to gravitational forces.

Nucleus

The membrane-bound organelle found in eukaryotic cells that contains most of the cell's genetic material.

Electrons

Subatomic particles with a negative charge, orbiting the nucleus of an atom.