Determining the bond approaches maturity

Reference no: EM13953269

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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

Required

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

Reference no: EM13953269

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