Chang Corp

question 2

Multiple Choice

Chang Corp. purchased $1,000,000 of bonds at par value on April 1, 2014. The bonds pay interest at the rate of 10%. Chang intends to hold these bonds to maturity. Which of the following statements is false?

• A) Since the bonds were issued at par value, the cash interest will be the same as interest revenue.
• B) The bonds will earn $75,000 of interest by December 31, 2014.
• C)The bond investment must be accounted for using the fair value method.
• D)Since the bonds were classified as held-to-maturity, the company would not recognize unrealized gains or losses on the bonds during the period held by Chang.

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Definitions:

Emotional Experience

The complex psychological state involving an individual's subjective feelings, thoughts, and physiological responses to stimuli.

Facial Feedback Hypothesis

The theory that facial movements can influence emotional experiences, suggesting that smiling can make you feel happier.

Affect How You Feel

This describes the influence that emotions or mood have on an individual's perception and reactions.

Certain Facial Expression

Specific configurations of facial muscles that convey particular emotions or reactions.