Question content area top

Part $1$

Under the

effective$-$interest

method of amortizing bond$$ premiums, the interest expense recorded for each

semi$-$annual

interest payment

Question content area bottom

Part $1$

A$.$

will increase over the life of the bond.

B$.$

will equal the amount of cash paid for each

semi$-$annual

interest payment.

C$.$

is at the same percentage of the$$ bond's carrying value for every interest payment.

D$.$

is equal to the carrying value of the bond times the contract rate of interest for each

semi$-$annual

interest period.