This may be considered as a means of repaying funds that are borrowed through a bond by periodic payments to a trustee who retires part of the issue by purchasing the bonds in the market.a.Fund in generalb.Call premiumc.Call provisiond.Sinking fund
Question
This may be considered as a means of repaying funds that are borrowed through a bond by periodic payments to a trustee who retires part of the issue by purchasing the bonds in the market.a.Fund in generalb.Call premiumc.Call provisiond.Sinking fund
Solution
The correct answer is d. Sinking fund. A sinking fund is a means by which an organization sets aside money over time to retire its indebtedness. Funds are paid into the sinking fund, which then makes periodic purchases of the bonds in the open market.
Similar Questions
This help facilitates the orderly retirement of the bond issue. In simple terms, a sinking fund is a pool of money reserved by a corporation to help repay previous issues and keep the company financially stable as it sells bonds to investors.a.Sinking fund provisionb.Liability provisionc.Equity provisiond.Asset provision
Sinking fund bonds:Multiple ChoiceDecline in value over time.Are bearer bonds.Require equal payments of both principal and interest over the life of the bond issue.Are registered bonds.Require the issuer to set aside assets to pay bonds at maturity.
A loan made to the government that pays a fixed amount of interest at a certain time is a _____.A.bondB.hedge fundC.stockD.savings account
Which Debt fund has the provision to pay regular income to the investors looking for income after retirement?
Fill in the Blank QuestionFill in the blank question.A trustee is a financially firm that acts as a bondholder's representative.
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