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Business Accounting Principles of Accounting

Bonds are a form of loan or debt that is being issued by the company. These can be issued on premium or at a discount. Bonds can be secured, unsecured, convertible, term bonds or serial bonds. To Match: Each term with the related term. Term Matching term 1. Discount f. Premium 2. Callable a. Convertible 3. Face interest rate d. Market interest rate 4. Unsecured b. Secured 5. Registered c. Coupon 6. Term e. Serial There are several types of bonds that can be issued by the business. Below terms describes and matches the same: Term Matching term Explanation 1. Discount f. Premium When bonds are issued at value more than face value, then it is known as issued at premium and when bonds are issued at value less than face value, then it is known as issued at discount. 2. Callable a. Convertible Callable bonds can be redeemed by the issuer before maturity date. Convertible bonds can be converted into shares as per specified at the time of issue. 3. Face interest rate d. Market interest rate Interest rate mentioned on the bonds is known as face interest rate, but interest rate prevailing in the market is known as market interest rate. 4. Unsecured b. Secured Unsecured bonds are not secured with any kind of property or any other asset. Secured bonds are secured by property or other kind of asset. 5. Registered c. Coupon For registered bonds, bondholder is the person whose name is mentioned on the instrument. Under coupon bonds, the person who holds bonds is known as bondholder. 6. Term e. Serial Term bonds mature only at a single date, but serial bonds mature over different dates.

Bonds are a form of loan or debt that is being issued by the company. These can be issued on premium or at a discount. Bonds can be secured, unsecured, convertible, term bonds or serial bonds. To Match: Each term with the related term. Term Matching term 1. Discount f. Premium 2. Callable a. Convertible 3. Face interest rate d. Market interest rate 4. Unsecured b. Secured 5. Registered c. Coupon 6. Term e. Serial There are several types of bonds that can be issued by the business. Below terms describes and matches the same: Term Matching term Explanation 1. Discount f. Premium When bonds are issued at value more than face value, then it is known as issued at premium and when bonds are issued at value less than face value, then it is known as issued at discount. 2. Callable a. Convertible Callable bonds can be redeemed by the issuer before maturity date. Convertible bonds can be converted into shares as per specified at the time of issue. 3. Face interest rate d. Market interest rate Interest rate mentioned on the bonds is known as face interest rate, but interest rate prevailing in the market is known as market interest rate. 4. Unsecured b. Secured Unsecured bonds are not secured with any kind of property or any other asset. Secured bonds are secured by property or other kind of asset. 5. Registered c. Coupon For registered bonds, bondholder is the person whose name is mentioned on the instrument. Under coupon bonds, the person who holds bonds is known as bondholder. 6. Term e. Serial Term bonds mature only at a single date, but serial bonds mature over different dates.

Solution Summary: The author explains the various types of bonds that can be issued by the business.

Principles of Accounting

Principles of Accounting

12th Edition

ISBN: 9781133626985

Author: Belverd E. Needles, Marian Powers, Susan V. Crosson

Publisher: Cengage Learning

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