A Disadvantage of the Classification Method Is That the Basis

question 58

True/False

A disadvantage of the classification method is that the basis for comparison is not called out.

---

Definitions:

Carrying Value

The book value of an asset on a company's balance sheet, calculated as the original cost minus accumulated depreciation or amortization.

Semiannual Interest

Interest calculated and paid twice a year on an investment or loan.

Issuance Date

The specific date on which a financial instrument, like a bond or stock, is officially issued and typically made available for sale.

Discount Bond

A bond sold for less than its face value and will mature at its face value, resulting in capital appreciation.