A Bearer Bond Has the Disadvantage(s) Of

question 40

Multiple Choice

A bearer bond has the disadvantage(s) of:

• A)being non-transferable if lost or stolen.
• B)ownership of the bonds are recorded in the company's books.
• C)no direct communication as it is held by an unidentified owner.
• D)having to remit the coupon to the issuer (company) to collect.
• E)difficulty in tax collection on interest when the holder is unknown.

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Definitions:

Gain on Sale of Investment

The profit realized from selling an investment for more than its purchase cost.

Fair Value

The estimated market value of an asset or liability based on current prices in an open and competitive market.

Equity Securities

Financial instruments that represent ownership in a company, such as stocks, entitling holders to dividends and capital gains.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of a business.