The Result of Using the Effective Interest Method of Amortization

question 148

Short Answer

The result of using the effective interest method of amortization for bond discounts is that the
a.interest expense for each amortization period is constant.
b.effective interest rate for each amortization period is constant.
c.amount of interest expense decreases each period.
d.cash interest payment is greater than the interest expense.

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Definitions:

Fixed Interval

A schedule of reinforcement where the first response is rewarded only after a specified amount of time has elapsed.

Reinforcement

In behavior psychology, a stimulus or event that follows a behavior and increases the likelihood of that behavior occurring again.

Response

A reaction to a specific stimulus or situation, often studied in psychology to understand behavior.

Variable Interval

A schedule of reinforcement where a response is rewarded after an unpredictable amount of time has passed.