The premium or discount on bonds purchased as investments is accounted for in the same manner as a premium or discount on bonds sold (i.e.,bond payable).

Question

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Investments generally would not be adjusted for amortization of any premiums or discounts because GASB standards require fair value accounting. Premiums and discounts on bonds payable are amortized in the governmental activities accounts at the government-wide level.

The Premium or Discount on Bonds Purchased as Investments Is