a
Concept Introduction:
Bond issue at discount: When the bond is sold at less than its par value, it is said to have been issued at discount, as the bond issued at discount has a market price less than face value, thus giving the capital appreciation at maturity when the bond is issued at a discount the bonds coupon rate would not be same as interest expense.
The amount of discount on the issue of bond.
b
Concept Introduction:
Bond issue at discount: When the bond is sold at less than its par value, it is said to have been issued at discount, as the bond issued at discount has a market price less than face value, thus giving the capital appreciation at maturity when the bond is issued at a discount the bonds coupon rate would not be same as interest expense.
The interest expense will be recognized over the life of these bonds.
c
Concept Introduction:
Bond issue at discount: When the bond is sold at less than its par value, it is said to have been issued at discount, as the bond issued at discount has a market price less than face value; thus, giving the capital appreciation at maturity when the bond is issued at a discount the bonds coupon rate would not be same as interest expense. When a bond is issued at a discount, the amount of the discount is amortized over the life of the bond.
The straight-line amortization table for the bond
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