If a Company Uses the Effective Interest Method of Amortizing

question 64

Multiple Choice

If a company uses the effective interest method of amortizing a bond premium,the carrying value of the bond

• A)will decrease by equal amounts each year.
• B)will decrease by smaller amounts each year.
• C)will decrease by larger amounts each year.
• D)will be lower than the face value of the bond until maturity.

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