CFA Institute bond returns calculations considers accrual accounting which means
A) bond default losses will accrue over future years.
B) bond interest income accrues daily interest to the investor.
C) bond discount is accrued over the term to maturity.
D) interest is only recognized when it is paid.

Question

Quizplus · Accepted Answer

Accrual accounting for bonds means that interest income is recognized as it is earned on a daily basis, rather than only when it is received.

CFA Institute Bond Returns Calculations Considers Accrual Accounting Which Means