The following is a list of terms and definitions associated with liabilities: 1. Face value 2. Market

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The following is a list of terms and definitions associated with liabilities:
1. Face value
2.
Market interest rate
3. Stated interest rate
4. Sold at a discount
5. Maturity date
6. Bond certificate
7. Amortization schedule
8. Sold at a premium
a. Amount paid when a bond matures.
b. Rate of return investors who are buying similar bonds demand for their investments.
c. Rate used to determine the amount of interest the issuing company of a bond must pay to the investor.
d. The date on which the face value of the bond must be paid to the investor.
e. Document that contains the terms of the bond.
f. This occurs when the stated rate of a bond is less than the market rate.
g. A schedule that illustrates the amortization of a bond discount or premium over time.
h. This occurs when the stated rate of a bond is greater than the market rate.
Required
Match each term with the appropriate definition.
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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Financial ACCT2

ISBN: 978-1111530761

2nd edition

Authors: Norman H. Godwin, C. Wayne Alderman

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