Question 5 Bonds were issued at a discount. In the bond amortization schedule: The...
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Question Bonds were issued at a discount. In the bond amortization schedule: The interest expense is decreasing with each successive interest payment. The reduction in the discount is decreasing with each sugcessive interest payment. The outstanding balance book value of the bonds declines eventually to face value. The total effective interest over the term to maturity is equal to the amount of the discount plus the total cash interest paid. 
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Bonds were issued at a discount. In the bond amortization schedule:
The interest expense is decreasing with each successive interest payment.
The reduction in the discount is decreasing with each sugcessive interest payment.
The outstanding balance book value of the bonds declines eventually to face value.
The total effective interest over the term to maturity is equal to the amount of the discount plus the total cash interest paid.
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