Describe the two distinct obligations incurred by a corporation when issuing bonds.

When are corporations likely to call their bonds?

2. The printing costs and accounting/legal fees associated with the issuance of bonds should: (A) Be expensed when incurred. (B) Be reported as a deduction from the face amount of the bonds payable on the balance sheet. (C) Be accumulated in a deferred charge account (unamortized asset) and amortized to expense over the life of the bonds. (D) Be recorded as an expense all in the year the bonds mature or are retired. (E) None of the above.

Demonstrate how to identify and account for debt investments classified for reporting purposes as available-for-sale securities.