Which of the Following Statements About Bonds Is Correct

question 144

Multiple Choice

Which of the following statements about bonds is correct?

• A)The cash interest paid is calculated as the bond face value × the effective rate of interest.
• B)The cash interest paid is calculated as the bond face value × the face rate of interest.
• C)The difference between the cash interest paid and the interest expense is added to the carrying value of the bonds if bonds were sold at a premium.
• D)The difference between the interest expense and the interest paid is deducted from the carrying value of the bonds if bonds were sold at a discount.

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Definitions:

Anglo Saxon Protestants

A social group historically associated with the white, Protestant, largely upper-class segment of the population in the United States, often abbreviated as WASP.

WASPs

An acronym for White Anglo-Saxon Protestants, often referring to a socio-economic and cultural elite in the United States.

Assimilation

The process by which individuals or groups adopt the culture, customs, and values of another group, losing their original identity.

Cultural Pluralism

A societal condition in which diverse cultural, racial, or religious groups are present and maintain their practices while coexisting respectfully and equitably.