100 points MC Qu. 210 which one of the following Which one of the foliowing sten

Question

100 points MC Qu. 210 which one of the following Which one of the foliowing stenements about amortzation of discounts and premurms O Under strsight-ire amortizaton, when a bond is sold at a premium, the arnal premsum amozton is the toal premiurn divided by the number of years unti bond maturtty When a bond is sold ot a discourt interest expense recorded using the ettect verter est msethod is less than the merest paid on the bond The emec ve merest method of amortization is considered to be conceptuely super or to sei tine an onzon O When a bond discount is amorazed using the effective-interest method the promsed interest peyment s less tn the interes expense, so the bond Isblity will increase es o result of the Multbiple Choice MC Qu. 210 Which one of the folowingLe10-$1 see bore D Type here to search 6 8 9

Explanation / Answer

Answer: The incorrect statement is:

'When a bond is sold at a discount, interest expense recorded using the effective interest method is less than the interest paid on the bond'.

Explanation:

The interest expense would be more, the difference being the amount of discount to be amortized.

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