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Black Mountain issued fixed-rate bonds when interest rates were 5%. Market interest rates have increased to 7% since then. An analyst using only the carrying
Black Mountain issued fixed-rate bonds when interest rates were 5%. Market interest rates have increased to 7% since then. An analyst using only the carrying amount while reviewing the company's balance sheet, will most likely:
A. underestimate Black Mountain's interest coverage ratio.
B. overestimate Black Mountain's economic liabilities.
C. underestimate Black Mountain's economic liabilities.
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