When a Portion of a Bond Issue Is Redeemed, a Related

question 150

True/False

When a portion of a bond issue is redeemed, a related proportion of the unamortized premium or discount must be written off.

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Definitions:

Externality

An externality is a cost or benefit caused by a producer that is not financially incurred or received by that producer.

Market Exchange

The process through which goods, services, or assets are traded between buyers and sellers at a determined price.

Negative Externalities

Unintended and unfavourable outcomes of an activity or transaction that affect third-party stakeholders who did not choose to be involved in that activity.

Positive Externalities

Benefits experienced by a third party not directly involved in the production or consumption of a good or service.