Match each term that follows with the appropriate definition. 1. Face interest rate 2. Bond indenture 3.
Question:
1. Face interest rate
2. Bond indenture
3. Secured bonds
4. Bond issue
5. Coupon bonds
6. Callable bonds
7. Market interest rate
8. Convertible bonds
9. Registered bonds
a. A contract that defines the rights, privileges, and limitations of the bondholders.
b. Bonds that allow the bondholder to exchange a bond or a specified number of shares of common stock.
c. The fixed rate of interest paid to bondholders based on the face value of the bonds.
d. Bonds that give the issuer the right to buy back and retire the bonds before maturity at a specified price, which is usually above face value.
e. The rate of interest paid in the market on bonds of similar risk.
f. The total value of bonds issued at one time.
g. Bonds issued in the names of the bondholders.
h. Bonds that carry a pledge of certain corporate assets as a guarantee of repayment.
i. Bonds not registered with the organization but bearing coupons stating the amount of interest due and the payment date.
Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a... Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...
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Related Book For
Principles of Accounting
ISBN: 978-1133626985
12th edition
Authors: Belverd E. Needles, Marian Powers and Susan V. Crosson
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