Using the Straight-Line Amortization Method, If Bonds Are Sold at a Discount

question 34

Multiple Choice

Using the straight-line amortization method, if bonds are sold at a discount:

• A) interest expense in the beginning of the bond's life will be less than interest expense at the end of the bond's life.
• B) interest expense in the beginning of the bond's life will be more than interest expense at the end of the bond's life.
• C) unamortized discount is subtracted from the face value of the face value of the bond to determine its carrying value.
• D) unamortized discount is added to the face value of the bond to determine its carrying value.

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