Read each statement? below, indicate if it is true or? false, and give a brief e

Question

Read each statement? below, indicate if it is true or? false, and give a brief explanation of your answer.

6. When the year-end accrual of interest and amorlization of discount is recorded, the carrying value of Bonds Payable o the balance sheet will increase. 0 A, as the balance in the discount account decreases (as it is amortized), the carrying value of the bonds increases. O B. as the balance in the discount account decreases (as it is amortized), the carrying value of the bonds decreases. O c. as the balance in the discount account increases (as it is amortized, the carrying value of the bonds increases D, as the balance in the discount account increases (as it is amortized), the carrying value of the bonds decreases.

Explanation / Answer

When year end accural interest and amortization of discount is recorded then carrying value of bonds payable on the balance sheet.

so answer is a) As the balance in the discount account decrease (as it is amortized), the carrying value of the bonds increases.

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