5. 7. 8. A theoretical difference between the effective interest method and the straight line amortization method is that the effective interest method is easier to use produces a result that is based on a constant rate of interest c. produces a result that is based on a constant interest expense can be used if there is a material difference in the computation when compared to the straight-line method When bonds are sold at a premium and the effective interest method is used for amortization, at each subsequent interest payment date, the cash paid is: Equal to the effective interest. b. Less than the effective interest. Greater than the effective interest. More than if the bonds had been sold at a discount. Under IFRS, issued convertible bonds are Always recorded using the fair value option. Recorded at face value without consideration of a premium or discount. Recorded at face value for the liability along with the associated premium or discount. Separated into debt and equity components with the liability component recorded at fair value and the residual assigned to the equity component. An outflow of resources embodying economic benefit is regarded as "probable" when a. b. The probability that the event will occur is 50% likely. The probability that the event will occur is the same as the probability that the event will not occur. The probability that the event will occur is greater than the probability that the event will not occur. The probability that the event will not occur is greater than the probability that the event will occur