When the effective-interest method of amortization is used for a bond premium, the amount of interest expense for an interest period is calculated multiplying the
a. face value of the bonds at the beginning of the period by the contractual interest rate.

Answer: d. carrying value of the bonds at the beginning of the period by the effective interest rate. The effective-interest method of amortization is used to account for bond premiums or discounts that affect the periodic interest expense. Under the method, the interest expense for each period is calculated by multiplying the carrying value of the bond at the beginning of the period by the effective interest rate. The carrying value of the bond is the face value adjusted for any discounts or premiums that were paid.