Which of the Following Statements Regarding Amortization Is True

Which of the following statements regarding amortization is true?

A) Amortization of the premium causes the premium on bonds payable account to increase.
B) Amortization of the premium causes the amount of interest expense to increase.
C) Cash interest payments on bonds equals interest expense on the income statement when there is amortization of bond premium.
D) Amortization of a premium continues over the life of the bond until the balance in the account is reduced to zero.

Correct Answer:

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