What are debt issue costs and how should they be reported?

Q: How Interest, Principal, and Loan Balance Illustrated?

A: Answer: Interest is measured as a percentage of a loan balance, annually paid to the lender for the…

Q: What does Total debt include?

A: Answer: Generally, debt is an obligation imposed upon a corporation to manage its business. Total…

Q: Give an example of a debt ratio?

A: Companies’ capital structure may contain debt and equity. It is not necessary for any company to…

Q: Define Debt-to-assets ratio

A: Debt-asset ratio is a measure that tells how much assets of the firm are financed with the debt.…

Q: What is a debt security?

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

Q: A finance charge includes which elements?

A: Finance charge is a very common occurrence associated with the use of credit. For example users of…

Q: What is the distinction between debtor and creditor?

A: Accounts receivable Accounts receivable refers to the amounts to be received within a short period…

Q: What are some forms of off-balance-sheet financing?

A: Balance Sheet: Balance Sheet summarizes the assets, the liabilities, and the Shareholder’s equity of…

Q: Explain an example of debt investment.

A: Debt Investment Debt Investment is refer as when the company raises the money by selling the debt…

Q: when is stated interest rate of a debt instrument presumed to be fair?

A: Financial instruments are the contract those are traded in the market. the primary financial…

Q: Define  debt investment.

A: Debt Investment: Debt Investment considered as Lending money on loan to the issuing entity. The main…

Q: Why What kind of stream of income does a debt security pay for the duration of the security? A fixed…

A: The Answer

Q: Explain in detail what is debt or debt financing? Examples

A: In a debt arrangement, one party is allowed to borrow some amount from other party as per given…

Q: What are the differences between a debtor and a creditor?

A: Creditor: Creditor is a person or a company who has provided fund or loan, and hence, has a claim…

Q: what reporting categories are used to account for debt investments?

A:

Q: What does financing activities includes?

A: Cash Flow Statement:   It is a financial statement prepared by a company to report their cash…

Q: How to record purchase of a  debt investment? Give an example.

A: Journal entry: Journal entry is a set of economic events which can be measured in monetary terms.…

Q: Discuss the optimal amount of debt in the presence of taxes and costs associated with financial…

A: Financial distress is a situation or a point where a firm is unable to pay its debt or firm is…

Q: Why do we use an after-tax figure for cost of debt but not for cost of equity?

A: Cost of debt is the interest payments a company needs to make for debt financing, whereas cost of…

Q: explain the derecognition of debt;

A: Derecognition of debt As bonds are issued, then an entity may leave a bond that is outstanding till…

Q: what is the difference between finance and accounting?

A: Finance means the management of assets and liabilities of a business organisation to focus upon…

Q: What is financing deficit ?

A: When the amount of expenses exceeds the amount of revenues in a particular period is known as the…

Q: Explain Types of Debt Instruments

A: Answer: Debt instrument is like a tool a company may use in capital raising. It allows the holders…

Q: What is financial reporting environment?

A: A short introduction to Financial Reporting- Basically it is a standard accounting practice that…

Q: When should a debt security be classified as held-tomaturity?

A: Debt securities: Debt security is money borrowed at a specific rate of interest which must be repaid…

Q: What are financial obligations? How they can be overcome?

A: Liabilities:The claims creditors have over assets or resources of a company are referred to as…

Q: Name the two types of debt financing?

A: Debt is the amount owed by the company for a particular period from the date of the company's…

Q: What are the financing borrowing activities?

A: The statement of cash flows is the statement which shows the change in the cash and cash equivalents…

Q: Why does the use of debt lower ROA?

A: Introduction: Debt can be characterised as an amount or sum owned by a person to another for…

Q: How should a debt callable by the creditor be reported inthe debtor’s financial statements?

A: Liabilities: The claims creditors have over assets or resources of a company are referred to as…

Q: Explain an example how to record the purchase of debt investment.

A: When a debt investment is purchased , it is recorded as a asset in the books of the company as it is…

Q: What do we call the cost that a borrower must payto use debt capital?

A: Debt capital is the capital that is borrowed from various financial institutions or other lenders…

Q: What are the benefits of using debt security?

A: The financial instruments which are bought by investors, or corporations, or mutual funds, are…

Q: Why are claims on income discretionary with equityfinancing but nondiscretionary with debt…

A: Liability: In monetary bookkeeping, a liability is characterized as the future penances of financial…

Q: Describe the key characteristics of a debt investment and demonstrate how to account for a purchase…

A: Debt Instrument:   A debt instrument is a financial instrument that enables the issuer of the…

Q: Define required rate of return on debt

A: The required rate of return: This rate of return equates to the minimum return an investor would…

Q: What are the essential characteristics of liabilities for purposes of financial reporting?

A: LiabilitiesLiabilities are referred to as the obligations of the business towards the creditors for…

Q: Define debt service requirements

A: Debt service requirement is very much essential for a company if it wants to maintain a good credit…

Q: What are the advantages and disadvantages of short-term versus long-term debt asidentified in this…

A: Short term debt: Short term debts are debts or financial commitments that are expected to be settled…

Q: What does the disclosure note for debt includes?

A: Debt securities: The financial instruments which are bought by investors, or corporations, or mutual…