Premium on Bonds Payable
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Premium on Bonds Payable is the account used when bonds are issued above face value; it indicates that market interest rate is below contract rate. This account is a liability account.
Definitions
According to College Accounting: A Practical Approach by Slater (13th edition),
- Premium on Bonds Payable. Account used when bonds are issued above face value; it indicates that market interest rate is below contract rate. This account is a liability account.
Related concepts
- Accounting (alternatively known as accountancy) is management of financial data, information, and knowledge about financial transactions of legal entities. Accountancy tends to include bookkeeping and, depending on a particilar enterprise, may also include quatitative analysis of financial data in the bookkeeping system and/or business intelligence.
