# The principal of a bond is ________. A. the person who sold the bond for the company B. the person who bought the bond C. the interest rate printed on the front of the bond D. the face amount of the bond that will be paid back at maturity

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### Principles of Accounting Volume 1

19th Edition
OpenStax
Publisher: OpenStax College
ISBN: 9781947172685

#### Solutions

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FindFindarrow_forward

### Principles of Accounting Volume 1

19th Edition
OpenStax
Publisher: OpenStax College
ISBN: 9781947172685
Chapter 13, Problem 3MC
Textbook Problem
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## The principal of a bond is ________.A. the person who sold the bond for the companyB. the person who bought the bondC. the interest rate printed on the front of the bondD. the face amount of the bond that will be paid back at maturity

To determine

Concept introduction:

Bonds:

are defined as debt instruments which are usually issued by the company that borrows to its lenders. They are issued at a rate of interest that is specified and for a specified period of time. The bondholders receive a fixed rate of interest on the bonds and the repayment of the bonds is made at the maturity date.

To choose:

The correct statement about the Principal of a bond.

### Explanation of Solution

Principal of a bond is the face amount of the bond payable at the maturity. Hence the correct option is D.

A. Principal of a bond is not a person it is actually the face amount of the bond payable at the maturity. Hence this option is incorrect...

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