Firms sometimes acquire debt securities with the intention of holding these securities until maturity. U.S. GAAP and IFRS require firms to measure marketable securities for which firms have an intent and ability to hold to maturity by _____. A firm initially records these debt securities at acquisition cost. This acquisition cost will differ from the maturity value of the debt if the coupon rate
on the bonds differs from the _____.
a. the imputed interest method; required market yield on the bonds at the time the firm acquired them
b. the straight-line method; required market yield on the bonds at the time the firm acquired them
c. the effective interest method; required market yield on the bonds at the time the firm acquired them
d. the effective interest method; required market yield on the bonds at the time the bonds were originally issued.
e. the straight-line method; required market yield on the bonds at the time the bonds were originally issued.
C
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