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If you have difficulty answering the following questions, learn more about this topic by reading our Bonds Payable (Explanation).
The expected balance in the account Bonds Payable.
The expected balance in the account containing the amount of the unamortized bond discount.
The expected balance in the account containing the amount of the unamortized bond premium.
The amortization of the bond __________ will result in the issuer's interest expense being greater than the interest payments.
The amortization of the bond __________ will result in less interest expense than the amount of the interest payments.
The book value or carrying value of a bond issued at a discount will __________ as the discount is amortized.
If a 9% bond is selling at 104 plus accrued interest, the bond's effective interest rate will be __________ than 9%.
When the bond market's interest rates increase, the market value of an existing bond will __________.
When a bond is issued between interest payment dates, the issuer of the bond will receive an interest payment from the buyer at the time that the bonds are issued.
It is common for a bond to pay a fixed amount of interest in each of the years of the bond's life.
A bond's yield-to-maturity is likely to be similar to the bond's __________ interest rate.
Which of the following interest rates is different?
Which amortization method will result in each year's bond interest expense increasing as a bond's carrying value is increasing?
Under the effective interest rate method of amortizing bond discount or premium, the interest expense for the period is the result of multiplying the__________ interest rate at the time the bond was issued times the bond's carrying value at the beginning of the current period.
A bond's maturity value is more likely to be its __________.
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Harold Averkamp (CPA, MBA) has worked as a university accounting instructor, accountant, and consultant for more than 25 years. He is the sole author of all the materials on AccountingCoach.com. Read more about the author.
