When bonds are issued at a premium and the effective interest method is used for amortization,at each interest payment date,the interest expense:

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When bonds are issued at a premium, the bond's price is greater than its face value, and the stated interest rate is higher than the market rate. As a result, at each interest payment date, the company needs to pay lower interest payments to bondholders than the stated rate. This difference between the stated interest rate and the actual interest payment is recorded as an amortization of the premium over the bond's life using the effective interest method. This causes the interest expense to decrease at each interest payment date, as the premium is gradually being reduced.

When Bonds Are Issued at a Premium and the Effective