There Are Two Methods of Amortizing a Bond Discount or Premium

question 137

True/False

There are two methods of amortizing a bond discount or premium: the straight-line method and the double-declining-balance method.

---

Definitions:

Assets Financed

The acquisition of assets (e.g., equipment, property) using debt or other financial instruments rather than direct payment.

Debt To Equity Ratio

A financial ratio indicating the relative proportion of shareholder's equity and debt used to finance a company's assets.

Accounts Receivable Turnover

A financial ratio that measures how efficiently a company collects cash from its credit sales by dividing net credit sales by the average accounts receivable.

Inventory Turnover

A ratio showing how many times a company has sold and replaced inventory over a period.