Bonds
Bonds
Bonds
TTH 2:30-4:00 pm
2. What are bonds? Differentiate contract rate and effective rate of interest.
3. Why might a corporation chose to issue debt securities rather than equity
securities to meet its additional long-term fund requirements?
8. When is a bond issued a face value? At less than face value? At more than
face value?
9. What is a bond price or market price? How is a bond price calculated given
the prevailing market rate of interest of similar obligations?
10.What are bond issue costs? How are they treated and presented in the
financial statements?
12.How would amortization of premium affect the nominal interest and the
carrying value of the bond?
13.How would amortization of discount affect the nominal interest and the
carrying value of the bond?
14.What are detachable stock warrants? Why do corporations issue bonds with
detachable stock warrants?