The Proper Procedure for Computing the Amortization of a Premium

question 61

Multiple Choice

The proper procedure for computing the amortization of a premium using the effective interest method includes multiplying

• A)the market rate of interest times the face value of the bonds
• B)the market rate of interest times the carrying value of the bonds
• C)the stated rate of interest times the face value of the bonds
• D)the stated rate of interest times the carrying value of the bonds

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