In Its 2016 Income Statement,WME Reported $11,000 of Interest Expense

question 55

Multiple Choice

In its 2016 income statement,WME reported $11,000 of interest expense on its outstanding bonds.During the year,WME paid its regular installments of $9,000 of interest in cash.In its reconciliation schedule,WME should:

• A)Show a $2,000 positive adjustment to net income under the indirect method for the decrease in bond premium.
• B)Show a $2,000 negative adjustment to net income under the indirect method for the decrease in bond premium.
• C)Show a $2,000 positive adjustment to net income under the indirect method for the decrease in bond discount.
• D)Show a $2,000 negative adjustment to net income under the indirect method for the decrease in bond discount.

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Definitions:

Mitochondrial Disease

A group of disorders caused by dysfunction of the mitochondria, the energy-producing structures in cells, leading to energy shortages in the body.

Vitamin A Storage

Refers to the body's storage of vitamin A, primarily in the liver, which is crucial for various bodily functions including vision, immune response, and skin health.

Mitochondrion

An organelle found in large numbers in most cells, where it produces energy through cellular respiration.

Mitochondrion

A membrane-bound cell organelle that generates most of the chemical energy needed to power the cell's biochemical reactions.