Under the effective-interest method of amortization,interest expense each period can be calculated by multiplying the:

Question

Quizplus · Accepted Answer

Under the effective-interest method of amortization, interest expense each period is calculated by multiplying the carrying value of the bonds (not the face value) times the effective-interest rate for the appropriate time period. This method takes into consideration the changes in the carrying value of the bonds as the bond amortization proceeds. Therefore, choice D is the correct answer.

Under the Effective-Interest Method of Amortization,interest Expense Each Period Can