When a bond is sold at a premium the: Multiple Choice ...

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Accounting

When a bond is sold at a premium the:

Multiple Choice

  • effective interest rate is less than the stated rate.

  • interest expense during the life of the bond exceeds the amount of cash interest payments during the life of the bond.

  • effective interest rate is greater than the stated rate.

  • effective interest rate relative to the stated rate is not known.

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