anuary 2, ear 1, Nast Co. issued 8% bonds with a face amount of $1,000,000 that mature on January 2, Year 7. The were issued to yield 12%, resulting in a discount of $150,000. Nast incorrectly used the straight-line method instead of the effective interest method to amortize the discount. How is the carrying amount of the bonds affected by the error? O A. OB. C. O D. At At December 31, Year 1 January 2, Year 7 Overstated Understated Overstated Understated Understated No effect Overstated No effect