Asked by Kevin Nguyen on Jun 20, 2024
Verified
Bonds that are subject to retirement at a stated dollar amount prior to maturity at the option of the issuer are called
A) early retirement bonds.
B) redeemable bonds.
C) options.
D) debentures.
Redeemable Bonds
Bonds that can be returned to the issuing entity before maturity for a predetermined price.
Retirement
The act of withdrawing from one's position or occupation, or the period of life after ending one's career, often implying financial self-sufficiency.
Stated Dollar Amount
A specified amount of money expressed in dollars, often referring to the face value of financial instruments or the nominal amount in transactions.
- Scrutinize the impact of terms for bond issuance on financial records, taking into account scenarios of premium and discount.
Verified Answer
KK
KEVIN KENNETHJun 25, 2024
Final Answer :
B
Explanation :
Redeemable bonds are those that can be retired or paid off at a specific price before their maturity date at the option of the issuer. This gives the issuer flexibility to refinance the debt if interest rates decline.
Learning Objectives
- Scrutinize the impact of terms for bond issuance on financial records, taking into account scenarios of premium and discount.