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(Solution) - The following components are computed annually when a bond is

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The following components are computed annually when a bond is issued for other than its face value:
? Cash interest payment
? Interest expense
? Amortization of discount/premium
? Carrying value of bond

State whether each component will increase (I), decrease (D), or remain constant (C) as the bond approaches maturity given the following situations:
1. Issued at a discount
2. Issued at a premium


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This question was answered on: Jul 11, 2017

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