When a Bond Payable Is Issued at a Discount, Which

Multiple Choice

When a bond payable is issued at a discount, which of the following would not occur as the bond is amortized each year?

A) Interest expense would increase.
B) The book value of the bonds would increase.
C) The amortization for each year the bond approaches maturity, when the effective-interest method is used, would increase.
D) The amount of amortization would be reported as an increase in cash flow from operating activities.