When the Effective-Interest Method of Amortization Is Used,what Happens to Interest

question 210

Multiple Choice

When the effective-interest method of amortization is used,what happens to interest expense as a bond moves toward maturity?

• A)Interest expense falls for bonds sold at either a discount or a premium.
• B)Interest expense rises for bonds sold at a discount and falls for bonds sold at a premium.
• C)Interest expense rises for bonds sold at either a discount or a premium.
• D)Interest expense falls for bonds sold at a discount and rises for bonds sold at a premium.

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