The effective interest rate method will record amortization of a bond discount or premium in a manner that produces a constant rate of interest expense from period to period.

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the effective interest rate method, also known as the effective interest method, is an accounting practice used for amortizing the discount or premium on bonds payable. This method results in a constant rate of interest expense over the life of the bond, regardless of the interest payments being made.

The Effective Interest Rate Method Will Record Amortization of a Bond