Amortizing a discount on bonds payable:
A)Increases interest expense.
B)Increases periodic cash payments to bondholders.
C)Decreases interest expense.
D)Decreases periodic cash payments to bondholders.

Question

Quizplus · Accepted Answer

Amortizing a discount on bonds payable involves increasing the bond carrying value over time, which will increase the amount of interest expense recorded each period. The periodic cash payments to bondholders will not be affected by the amortization of the discount.

Amortizing a Discount on Bonds Payable