GASB Requires That Educational Institutions Who Engage in Business-Type Activities

GASB requires that educational institutions who engage in business-type activities and issue debt account for the debt by:

A) Recording the debt service as an expenditure as it becomes due.
B) Recording the interest as an expense when it is due and payable.
C) Recording the principal net of any premium or discount when the debt is issued and expense the interest as it is paid.
D) Recording the interest expense on the accrual basis, including amortizing the premium or discount, if applicable.

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