If Bonds Are Sold for a Discount, the Carrying Value

question 172

True/False

If bonds are sold for a discount, the carrying value of the bonds is equal to the face value less the unamortized discount.

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Definitions:

Favorable Variance

A financial term indicating that actual costs were lower than the planned or standard costs in a budget.

Budgeted Amount

The total amount of money that has been allocated for a specific purpose or period of time.

Return on Assets

A financial ratio that measures the profitability of a company in relation to its total assets.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenue.