The assumption of a stable interest expense per year is inherent under which of the following amortization methods?
A)present-value method
B)effective interest method
C)stated-interest method
D)straight-line method

Question

Quizplus · Accepted Answer

The straight-line method assumes a constant interest expense over the life of the bond, so the assumption of a stable interest expense per year is inherent in this method. The other methods may result in fluctuating interest expenses based on changes in the interest rate or compounding frequencies.

The Assumption of a Stable Interest Expense Per Year Is