When Bonds Are Issued at a Discount, the

Multiple Choice

When bonds are issued at a discount, the

A) applicable interest rate used to calculate interest expense is the prevailing market interest rate on the date of each interest payment date.
B) amortized cost of the bonds will decrease each period.
C) interest expense will not be a constant dollar amount over the life of the bond.
D) interest paid to bondholders will be a function of the effective interest rate on the date the bonds are issued.