What is a bond? A. It is a security that represents partial ownership in a business. B. It is a security that represents the debt of a government or a business that promises to pay a fixed amount. C. It is a security that represents the equity of a government or a business that promises to pay a fixed interest. D. None of the above

Q: A discount on bonds payable: O Occurs when a company issues bonds with a contract rate less than the…

A: Discount on bonds payable = Market rate - Contract rate

Q: Why might a company choose to raise money through bonds, rather than take out a note payable or…

A: Bonds are the long-term liability of the company where the company raises the money in lieu of…

Q: 6. Which is not considered as a debt security issued by private entities? a. Straight bonds b.…

A: A straight bond is something which is issued to the investor who gets interest on a regular interest…

Q: Bonds that pay no interest unless the issuing company is profitable are called Select one: O a.…

A: Wrong answer    B) Collateral trust bond: Collateral means additional security. Thus in collateral…

Q: What is the major difference between a CMO and the other types of mortgage-related securities?

A: Mortgage-backed securities are special investment proposals generated by financial intermediaries to…

Q: What is advantage of using bonds for financing instead of obtaining financing from the company's…

A: Debt financing is the process by which the business raises funds by offering the debt instruments.…

Q: 8. Who is the party in a bond contract who has the obligation to pay during maturity dates? a.…

A: Bond is a debt instrument issued by company or government. The holder of bonds  is the lender or…

Q: Companies pay rating agencies to rate their bonds, and the costs can be substantial. However,…

A: As you have asked multiple questions, we will solve the first question as per policy. Request you to…

Q: Why would a company wish to reduce its bond indebtedness before its bonds reach maturity? Indicate…

A:

Q: Revenue bonds, compared with general obligation bonds, generally A.) Are paid out of property or…

A: Revenue Bonds: Revenue bonds are a type of municipal bond issued by a government agency or entity to…

Q: Why would the company redeem the bonds prior to the maturity date if they were going to recognize a…

A: A bond appears to be a debt owing to a firm or government that pays holders a predetermined interest…

Q: Explain in detail and with examples why the functioning of mortgage institutions could be considered…

A: Mortgage institutions are the companies that are mainly into the production of mortgage loans, be it…

Q: The bonds in which the name of the owners is not registered with the Corporation that issues them…

A: Bonds can be of different types

Q: The bond trustee is usually a bank that is hired to represent the interests of the bondholders,…

A: The bond trustee has a fiduciary responsibility to act on behalf of the issuer.

Q: Who issues Bonds? Why should you own Bonds?  What are the risks of owning Bonds?

A: Bonds are the debt instrument issued to the bondholders of the organisation.

Q: None

A: Step 1: Introduction to Issuance of BondsBonds are issued when the issuer needs more funds or…

Q: 1, The establishment of a bond sinking fund is required at all times to settle bond liability.  A.…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Which of the following statements is true regarding secured and unsecured bonds? O Secured bonds are…

A: Solution: There are two types of bonds: 1. Secured bonds - These bonds are secured against specific…

Q: Which of the following describes a bond's credit risk? O The probability that financially sound…

A: The credit risk of a bond refers to the likelihood that the issuer of the bond will default on its…

Q: If a new competitor with scale enters, does that increase, decrease, or have no effect on the credit…

A: solution concept credit spread                 The term Credit spread is widely used while assessing…

Q: If a company has any debt covenants, those debt covenants need to be considered whenever that…

A: Debt Covenant: Debt covenants are limits that lenders (creditors, debt holders, investors) impose on…

Q: A bond is a certificate of indebtedness that sp the obligations of the borrowers to the lender.…

A: Bond is a debt insturment

Q: When a company exercises its call provision on bonds, the company pays the book value of the bonds…

A: Call provision on the bond is the option held by the issuer for redeeming back the bonds if in case…

Q: Explain what a unsecured debt, subordinated debt, senior debt is?   -is there risk in buying an…

A: Debt is the obligation that requires one party, the debtor to pay money to another party, the…

Q: Bonds which are collateralized by specific assets in the event the borrowing company defaults on…

A: Bonds are a form of liability for the business. These can be issued for short term or long term.…

Q: An indenture is the contract between the company and its bondholders and contains the bond’s…

A:

Q: A company is trying to determine whether a debt security should be classified as a trading security…

A: Please fallow the answer below: The Codification does not provide guidance on a specific time period…

Q: A Mortgage Backed Bond (as opposed to a Mortgage Backed Security or Pass Through) removes mortgages…

A: The mortgage-backed bond is the security of the loan. The mortgage bond has to be registered and…

Q: Explain what a callable bond is and under what conditions and expectations a company might wish to…

A: A callable bond can be defined as the type of bond which can be redeemed by the bondholders before…

Q: What does it mean when a company calls a bond?

A: Bonds: Bonds are long-term promissory notes that are issued by a company while borrowing money from…

Q: 44) Which is the definition of a protective covenant? a) Bonds are repaid at maturity, where…

A: Protective covenants are certain clauses in bond indenture which will be limiting the actions of…

Q: What are stock warrants and convertible debt? How do stock warrants work? How does convertible debt…

A: Stock warrant (SW) is a contract through which investors get rights to purchase the particular…

Q: What is the most obvious difference between debt and equity financing? a. Principal and interest…

A: Debt financing includes bonds and debts which are financial instruments and use to raise finance for…

Q: Which of the following is NOT TRUE? Select one: O a. If the stated rate is equal to the market rate…

A: Bonds issued are a form of liability for the business, on which it has to make regular interest…

Q: Bonds can be an effective counterbalance in a portfolio heavily invested in stocks. True False

A: Bonds: It is a type of investment wherein the issuer of the bond promises the holder of the bond to…

Q: 9. Which of the following is least likely to be a debt security? a. Government bonds b. Convertible…

A: Bonds and debts are the debt securities that are issued by the company in order to raise finance for…

Q: How are the Securities Investor Protection Corporation (SIPC) and the Federal Deposit Insurance…

A: An investor is a person who invests money in a stock, bond or in some other security so that return…

Q: When selling bonds at a premium, the premium received effectively a.does not affect the cost of…

A: Premium means selling of bond at price higher than face value.

Q: What is the advantage of issuing bonds instead of obtaining financing from the company’s owners?

A:

Q: When the contract rate of a corporate bond is lower than the market rate, what happens to the face…

A: First, let's understand the terms. The contract rate (also known as the coupon rate) is the interest…

Q: Treasury bonds carry high default risk because government has the option not to pay its…

A: Treasury bonds are risk free bond that are issued by the government of the country like US  Fed.…