Relationships

The following components are computed annually when a bond is issued for other than its face value:

Cash interest payment

Interest expense

Amortization of discount/premium

Carrying value of bond

Required:

State whether each component will increase, decrease, or remain constant as the bond approaches maturity given the following situations:

Status of Issuance	Cash Interest	Interest Expense	Amortization Disc./Prem.	Carrying Value
1. Issued at a discount	_________________	_________________	_________________	_________________
2. Issued at a premium	_________________	_________________	_________________	_________________