Which of the following statements is true?
A) The carrying amount of the bonds will increase each year if the bonds were issued at a discount.
B) The carrying amount of the bonds will increase each year if the bonds were issued at a premium.
C) Total interest expense will increase each year if the bonds are issued at a discount and the straight-line method of amortization is used.
D) Total interest expense will increase each year if the bonds are issued at a premium and the effective interest method of amortization is used.
A
You might also like to view...
Recording an account with a debit balance as a credit, or an account with a credit balance as a debit, will cause the trial balance to be out of balance by an amount that is evenly divisible by two
Indicate whether the statement is true or false
Theory Y characterizes people as:
A) Motivated solely by money B) Lazy and uninvolved C) Inherently worthwhile D) Complex and difficult to understand
As part of a union negotiation agreement, the United Clerical Workers Union conceded to be paid every two weeks instead of every week
A major firm employing hundreds of clerical workers had a weekly payroll of $1,000,000 and the cost of short-term funds was 12 percent. The effect of this concession was to delay clearing time by one week. Due to the concession, the firm ________. A) realized an annual loss of $120,000 B) realized an annual savings of $120,000 C) increased its cash cycle D) decreased its cash turnover
Javier Jimenez was pleasantly surprised to find out that within three to five years after expiration of a previous life insurance policy, he can
A) change beneficiaries. B) void the grace period. C) reinstate the policy subject to current qualifications. D) change the incontestability clause. E) both A and D above.