Which of the Following Is the Primary Effect of Amortizing

question 35

Multiple Choice

Which of the following is the primary effect of amortizing a discount on notes receivable?

• A)It increases the interest revenue so that the corporation's effective rate of return is brought up to the higher market rate.
• B)It reduces the discount and increases the carrying value of the note receivable until the carrying value is equal to the face value of the note.
• C)Both A and B are the primary effects of amortizing a discount.
• D)None of the above are accurate.

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Definitions:

Data Set

All the data collected in a particular study.

Trimmed Mean

A measure of central tendency calculated by removing a certain percentage of the largest and smallest values from a dataset before averaging the remaining data.

Geometric Mean

The central tendency of a set of numbers, calculated by taking the nth root of the product of n numbers, useful for sets of positive numbers.

Measure Of

A general term for a quantitative indicator used to assess or evaluate a specific attribute or property.