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The amortization of the discount on a bond payable results in additional interest expense recorded over the life of the bond. True or false? A
The amortization of the discount on a bond payable results in additional interest expense recorded over the life of the bond. True or false?
A the discount is amortized to interest expense over the life of the bond, the discount is actually additional interest expense that has to be paid because the bond's contract rate was less than the market rate on the bond issue date.
B the discount is amortized to interest expense over the life of the bond, but the discount actually decreases the interest expense that has to be paid because the bond's contract rate was more than the market rate on the bond issue date.
C the discount is amortized to interest expense over the life of the bond, but the discount actually decreases the interest expense that has to be paid because the bond's contract rate was less than the market rate on the bond issue date.
D the discount is amortized to interest expense over the life of the bond, the discount is actually additional interest expense that has to be paid because the bond's contract rate was more than the market rate on the bond issue date
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