How does the amortization schedule for an installment note such as a car loan differ from an amortization schedule for bonds?
A)The final carrying value is zero in an amortization schedule for an installment note.
B)The final carrying value is zero in an amortization schedule for bonds.
C)The final carrying value is zero in both amortization schedules.
D)The final carrying value is not zero in either amortization schedule.

Question

Quizplus · Accepted Answer

In an installment note, like a car loan, the final carrying value is zero because the loan is fully paid off by the end of the term. In contrast, bonds typically have a final carrying value equal to the face value, which is repaid at maturity.

How Does the Amortization Schedule for an Installment Note Such