What is a debt security?

Q: What is indexed bond?

A: It is a bond with a interest rate which is connected to a index, for example, the bond market…

Q: Define the term Deferred Loan Repayments?

A: Answer: A deferred loan payment is nothing but a loan agreement in which the borrower may start…

Q: What is Bond's interest income?

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

Q: What is investment-grade bond?

A: Bond is a financial instrument. Issuer issues bond to raise the fund and payback the amount at the…

Q: How are bonds amortized?

A: Bond Amortization: Over the course of the bond's existence, the principal (face value) of the loan…

Q: Distinguish between a debt security and an equity security.

A: Debt Security:    Debt security refers to a financial instrument that is issued by the organization…

Q: Why consider bonds?

A: A bond can be described as the security or asset which provides secure income to the investor…

Q: What is marginal rate (for debt)?

A: Marginal rate of debt is the rate of interest expected by the investors on their debt instruments…

Q: What is the difference between general obligation bonds and revenue bonds?

A: General Obligation Bonds(GOs) are bonds that are backed by the "full faith and credit" of the issuer…

Q: What are credit derivatives, and how do they operate?

A: Derivative instrument is the financila instrument which derive its value form the underlying asset.

Q: How does the decision to use debt involve a risk-versus-return trade-off?

A: Risk return trade off: If an investment has high risk, the investors expect more returns from it. If…

Q: What are accrued liabilities?

A: Accrued liabilities are the outstanding expenses which are due or incurred but not yet paid in cash.…

Q: What are contingent liabilities?

A: Liabilities by and large, are a commitment to, or it is an amount that one owes to another person.…

Q: What distinguishes current liabilities from long-term liabilities?

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

Q: What is a financial security?

A: Investors use financial security to be secured financially as they can get some income on periodic…

Q: what is the difference between bonds payable and accounts payable? explain your answer?

A: Bond payable and account payable both are liabilities of the company , which is to be paid in future…

Q: What is the significance of a debt coverage ratio?

A: Debt service coverage ratio (DSCR) is one of the numerous financial proportions that moneylenders…

Q: What is the loan cash flow?

A: Answer: A cash flow loan is nothing but a form of debt finance in which bank lends money usually for…

Q: What is credit enhancement, and what effect does it have on debt costs?

A: Credit enhancement represents the strategy that improves the business' credit risk profile. It helps…

Q: What is liabilities?

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

Q: What is the difference between debt and equity financing?

A:

Q: What is market debt ratio?

A: Debt ratio: The debt ratio is a financial ratio that quantifies the degree of a corporation’s…

Q: what is difference between a bond and a term loan? what are the advantages of a term loan over a…

A: A bond is a fixed-income security that speaks to credit to a borrower (normally corporate or…

Q: Explain Loan Amortization Patterns?

A: A loan amortization pattern, as made by an amortization calculator, maybe a table enumerating each…

Q: What does “nonrecourse” financing mean?

A: Nonrecourse financing is a branch of commercial lending. It makes the lender only to repay from the…

Q: What does it mean to amortize a bond premium or discount? Why is it necessary?

A: Introduction: A bond is a contract between the bond lender and the bondholders. The two most common…

Q: What is general obligation bonds?

A: Bonds: A bond, also recognized as a fixed-income security, is a debt instrument shaped for the…

Q: What is a secured loan?

A: Secured Loan :  it is a type of loan in which lender lend money on the basis of collateral or…

Q: How are liabilities classified? Why is it important to classify liabilities?

A: A liability is a present obligation of the enterprise arising from past events, the settlement of…

Q: What is off–balance sheet financing?

A: To keep the debt-to-equity and leverage ratios low, companies opt to record certain liabilities and…

Q: Explain how to account for the impairment of held-to-maturity debt security.

A: Held to maturity securities are those securities which are purchased to be held till maturity…

Q: What are some types of credit derivatives?

A: A credit derivative is a type of financial contract where credit assets are kept as an underlying…

Q: What is income bond?

A: A financial instrument with a fixed cost that helps a company to raise funds for business operations…

Q: Describe the basic methods of debt financing?

A: Every company has two major types of financing one is through raising equity shares and the other is…

Q: What is Secured Borrowing?

A:

Q: How VAT affects the interest rate?

A: Solution-Value Added Tax  A value-added tax (VAT) is a consumption tax placed on a product whenever…

Q: What are financial securities?

A: Financial security can be defined as-“An instrument issued by companies, financial institutions and…

Q: What is the difference between fully secured liabilities, partially secured liabilities, and…

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

Q: What is the difference between callable and putable bonds?

A: Bonds are debt instruments issued by a company that borrows from its lenders. They are issued at a…

Q: How is Borrowing capitalized

A: Ans. Borrowing costs are interest and other expenses or costs that an entity incurs in connection…

Q: How is the purchase of held-to-maturity debt security at face value recorded?

A: Hold-to-maturity Debt:  These are the investment in debt securities, where the investor wishes to…

Q: Discuss how a form of debt can be classified as both Current and Long-Term Liabilities.  Why do…

A: Long Term Liabilities are the liabilities that become due for more than one year. They are the…

Q: What is mortgage bond?

A: A mortgage bond is secured by a mortgage, or a pool of mortgages, that are generally backed by…

Q: What is a non interest bearing notes?

A:

Q: What is informal debt restructuring?

A: Debt restructuring is a method wherein a company or an entity experiencing financial distress and…

Mortgages

A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.

Mortgage

The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.