If bonds have been issued at a discount and the effective-interest method is used, ________ over the life of the bonds.
A)carrying value of the bonds will decrease
B)interest payment will increase
C)interest expense will decrease
D)interest expense will increase

Question

Quizplus · Accepted Answer

Under the effective-interest method, the interest expense increases over the life of the bonds because it is calculated based on the carrying amount of the bonds, which increases as the discount is amortized.

If Bonds Have Been Issued at a Discount and the Effective-Interest