Bond issue costs
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:2. Bond issue costs, such as
printing fees, legal fees,
commissions, etc. are most
appropriately accounted for by:
a. charging them to an expense
account in the year the bonds are
actually sold.
b. debiting them to unamortized
bond issue costs, setting them as a
deferred charge on the statement of
financial position, and amortizing
them in a manner similar to bond
discount over the life of the bond.
c. charging them to an expense
account in the year the bonds are
originally dated whether or not they
are sold in that year.
d. considering them in the
measurement of the bonds payable.
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