Interest Bearing notes is measured at accrued interest plus?a.Accrued interestb.Face Valuec.Both answer is correctd.Fair Value

To answer the question regarding "Interest Bearing Notes," let's analyze each option provided.

1. Accrued Interest: This is the interest that has accumulated on the principal amount since the last interest payment.

2. Face Value: This refers to the nominal value of the note, or the amount to be repaid at maturity.

3. Fair Value: This represents the estimated worth of an asset based on current market conditions, which can vary from the face value.

Now, let's evaluate the answer choices:

• Option a (Accrued interest): While accrued interest is part of what makes up the total value of interest-bearing notes, it is not complete on its own.

• Option b (Face Value): The face value is significant because it constitutes what will be paid back to the holder of the note at maturity.

• Option c (Both answer is correct): This option suggests that both accrued interest and face value together represent the total valuation of the note, which is accurate.

• Option d (Fair Value): This can be more subjective and may not necessarily reflect the accrued interest plus face value.

Conclusion

The correct answer is c. Both answers are correct, as the measurement of interest-bearing notes includes both the accrued interest and the face value.