Restoration Company Issued Bonds That Had the Following Data Associated

question 275

Multiple Choice

Restoration Company issued bonds that had the following data associated with them: Interest to be paid is $40,000.
Interest expense to be recorded is $45,000.
Which of the following characteristics is true?

• A) The bonds are sold at a premium.
• B) After recording the interest expense, the amortization will decrease the bond carrying value.
• C) The difference between the interest expense and the interest to be paid is the bond's par value.
• D) After recording the interest expense, the amortization will increase the bond carrying value.

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Definitions:

Permanent Employees

Individuals employed on an ongoing basis, typically with full-time hours and benefits.

Full-Time

Employment status where individuals work the full number of hours defined as standard by their employer, typically around 35 to 40 hours a week.

Not-Invented-Here Problem

A form of bias where individuals or organizations favor internally developed products or ideas over those originating externally.

Hoarding Of Expertise

The practice of individuals or groups within an organization deliberately keeping knowledge or skills to themselves to maintain a competitive advantage.