Answered: Which type of bond has interest…

Which type of bond has interest payments that are exempt from federal income taxes? A. Corporate bonds B. Certificates of deposit C. Municipal bonds D. Treasury bonds

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter2: Gross Income And Exclusions

Section: Chapter Questions

Problem 19MCQ

See similar textbooks

Related questions

Q: In terms of public offerings of bonds, what is an indenture? A) a list of the duties of a trust…

A: Bond: It acts between any investor and a company like a loan.

Q: A bond is an interest-bearing negotiable certificate of long-term debt issued by a. a corporation.…

A: A bond is an interest-bearing negotiable certificate of long-term debt issued by municipality and…

Q: The purpose of a discount price for bonds is to: Select one: a. Increase profits b. Compensate the…

A: solution Concept The bond is issued at discount when -the coupon rate is less than…

Q: Bonds for which the owners' names are not registered with the ISSUING corporation are called Select…

A: Bearer Bond: A bearer bond is a fixed-income asset in which the holder, or bearer, owns the security…

Q: Which type of bond has interest payments that are exempt from federal income taxes?

A: Following are the bonds that are taxed: Certificates of deposit Corporate bonds Treasury…

Q: TRUE OR FALSE: The specific provisions of a bond issue are described in a document called a bond…

A: Bonds Bonds are a kind of interest bearing notes payable, usually issued by companies, universities…

Q: securities different from corporate b

A: Treasury securities and corporate bonds are both debt securities and promise to pay fixed return on…

Q: True (t) or False (f) _____ The board of directors may authorize more bonds than are issued

A: SOLUTIONS- BONDS- IT IS A FIXED INCOME INSTRUMENT THAT REPRESENT THE LOAN MADE BY AN INVESTOR TO A…

Q: Municipal

A: Bonds are defined as fixed income instruments are loans made by the investors to the borrowers.…

Q: Compare and contrast corporate bonds with Government bonds.

A: Bonds refer to the investment securities in which the money is lent by an investor to the company…

Q: The sale of bonds is also referred as: a. Public Finance b. Debt Finance c. Equity Finance d.…

A: The Bonds is a type of a loan. When a company, Government or muncipal corporation is in need of…

Q: Write the differences between treasury bill and corporate bond

A: Debt intrument: they are the tool an company or goverment can utilize for the purpose of obtaining…

Q: Write a detailed note on corporate bond

A: A corporate bond is a document under the company's seal which provides for payment of a principal…

Q: Under what conditions of bond issuance does a discount on bonds payable arise? Under what conditions…

A: Bond: Bond is a one of the security where holder will get fixed amount of interest each year and…

Q: Series EE bonds are: Question 5 options: corporate bonds that produce income that is taxed the…

A: The Series EE Bond is commonly called a "Patriot Bond". EE Bond is considered a non-marketable,…

Q: Identify the following as either an advantage (A) or a disadvantage (D) of bond financing for a…

A: Bonds payable: Bonds payable are referred to long-term debts of the business, issued to various…

Q: Bonds issued by the U.S. Treasury are referred to as benchmark bonds because: Select one: a.All…

A: U.S. Treasury Bonds are are government debt instruments issued by the U.S. Federal government for…

Q: 45.It is a short-term debt obligation for the private-sector firm or a government-sponsored…

A: Private sector firms and government sponsored corporations require short term financing for business…

Q: explain the following investments terms. d) Government Bonds e) Stocks f) Present Value

Q: Which of the following represent the bond issue procedures Select one: a. Board of directors and…

A: Bonds: It refers to a financial instrument used by issuer to borrow money from investors.

Q: shown in the image. What amount should Maine credit to premium on bonds payable?

A: Bond amount: Fair market value of the bond(Without warrant)/ Fair market value of the bond(With…

Q: Bond Valuation Theory Question 2 Securities issued by Corporations are classified as either debt or…

A: Introduction: Debt: Borrowing money for running the company called as Debt. Debt is a liability to…

Q: Which of the following are the "big-three" issuers of Bonds? OA. US Treasuries O B. Municipalities…

A: The issuers of bonds are the companies or organizations that issue the bond. The big issuers are…

Q: unamortized premium

A: Any unamortized premium should be reported on the balance sheet of the issuing corporation as Answer…

Q: Which of the following represent the bond issue procedures Select one: O a. Board of directors and…

A: A bond is a debt which the issuer owes to the holder on which the interest has to be paid and repay…

Q: Series EE bonds are: OU.S, savings bonds that produce income that may be exempt from some taxes.…

A: The EE Bond Series (commonly referred to as the "Patriot Bond") is a U.S. government bond that can…

Q: What is the difference between a corporate bond and a registered bond?

A: Introduction: Bonds are an example of a loan. It is similar to an IOU and so when you buy bonds, you…

Q: 5. If bonds issued by a corporation are sold at a discount, is the market rate of interest greater…

A: The corporation can issue the bond at discounts or premiums as per the market conditions and…

Q: Government debt securities are issued by Whose obligations are they?

A: Government debt securities are those securities that are issued by the federal government to provide…

Q: (I) Capital market securities fall into two categories: bonds and stocks. (II) Long-term bonds…

A: Capital market is a place where buyers and sellers of financial securities trade with each other.…

Q: Define each of the following terms:i. Development bond; municipal bond insurance; junk bond;…

A: Development bond: It is a bond issued by the government for financing development projects in the…

Q: :A dicount on bonds payable .Occurs when a corporation issues bonds with a stated rate more than the…

A: A discount on bonds payable is a contra liability account which represents unamortized discount on…

Q: When are corporations likely to call their bonds?

A: They are many types of Bond, Generally the Bonds are Paid at the time of Maturity to the Bond holder…

Q: True (t) or False (f) _____ Debt investments are investments in government and corporation bonds

A: Debt investments are investments in a company or firm by borrowing amount through the way of…

Q: State the types of corporate bonds.

A: Bonds are basically corporate debt units that are issued and securitized as the tradeable assets by…

Q: Which two of the following are the largest categories of fixed-income securities in the U.S.? I.…

A: Before knowing the largest categories of fixed-income securities in the U.S. lets know the…

Q: The legal document that spells out the rights of the bond holders and terms of a corporate bond is…

A: Solution:- When a company issues bond, it signs an agreement between the company and the bond…

Q: (a) From what sources might a corporation obtain fundsthrough long-term debt? (b) What is a bond…

A: (a)A corporation might obtain funds through long-term debt through the following sources: 1. Bonds…

Q: Define tax-exempt bonds

A: Bonds are the liabilities of the company which is issued to raise the funds required to finance the…

Question

Which type of bond has interest payments that are exempt from federal income taxes?

A.

Corporate bonds

B.

Certificates of deposit

C.

Municipal bonds

D.

Treasury bonds

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Describe the methods that an individual taxpayer that holds Series I Bonds can use to recognize interest. _______________________________________________________________________________________________________________________________________________
How are savings bonds different from a corporate bond?
Bond sinking fund earnings are (a) subtracted from the bond sinking fund. (b) added to the bond sinking fund. (c) subtracted from the current year interest expense. (d) added to the current year interest expense.
QUESTION 14 Which type of bond has interest payments that are exempt from federal income taxes? A. Certificates of deposit B. Corporate bonds C. Treasury bonds D. Municipal bonds
Should the federal government tax the interest payments an investor receives on a Treasury Bond
Interest from which of the following types of bonds is included in federal taxable income? a. City of New Orleans bond b. Bond of the Commonwealth of Puerto Rico c. State of California bond d. U.S. Treasury Bond e. All of these choices are excluded from income.
Define each of the following terms:a. Bond; Treasury bond; corporate bond; municipal bond; foreign bond
Series EE bonds are: Question 5 options: corporate bonds that produce income that is taxed the same as other investment income. corporate bonds that produce income that may be exempt from some taxes. U.S. savings bonds that produce income that is taxed the same as other investment income. U.S. savings bonds that produce income that may be exempt from some taxes.
Define tax-exempt bonds
Is it valid to claim in public statements that this bond issue will “pay for itself?”
State the types of corporate bonds.