The effective interest rate method of amortizing bond discounts and premiums results in a constant amount of interest expense every period.

Answer the following statement true (T) or false (F)


False

The effective interest rate method produces a different amount of interest expense every period as the carrying value of the bond liability increases or declines.

Business

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Because plant and equipment are reported as long-term assets on the balance sheet, they have no impact on net income for the period until they are sold

a. True b. False Indicate whether the statement is true or false

Business

When the total fixed costs decrease, the breakeven point ________.

A) increases B) decreases C) remains the same D) increases proportionately

Business

TG&I Industries, Inc, has had a portion of its factory site designated as a CERCLA clean-up area. The cost of the clean-up will be $675,000. The assessor has valued TG&I's plant at $7,000,000. TG&I wants that value reduced by the $675,000

A)?It is against public policy to give TG&I a credit for environmental clean-up costs. B)?TG&I is entitled to the credit of $675,000 only if it did not contaminate the site. C)?TG&I is entitled to a $675,000 credit. D)?TG&I is entitled to one-half of $675,000 as a credit.

Business

Under best efforts underwriting, the underwriter

A) pays for the entire security issue. B) sells the security on a commission basis. C) spreads the risk among different brokerage houses. D) makes a special appeal to the Securities and Exchange Commission to delay the issue.

Business