When Authorizing Bonds to Be Issued the Board of Directors

question 53

Multiple Choice

When authorizing bonds to be issued the board of directors does not specify the

• A) total number of bonds authorized to be sold.
• B) contractual interest rate.
• C) selling price.
• D) total face value of the bonds.

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Definitions:

Economies of Scale

Refers to the cost advantage achieved when production becomes efficient, as the scale of the output expands, typically resulting in a reduction in average cost per unit through increased production efficiency.

Cycle Inventory

Inventory that turns over regularly in the course of business operations, representing the portion of inventory intended to meet normal demand.

Supply Chain

The network between a company and its suppliers to produce and distribute a specific product to the final buyer.

Cycle Inventory

Inventory maintained to cater to the expected demand of customers over a given cycle time, effectively acting as a buffer to ensure smooth operations.