The Purpose of a Sinking Fund Is To

question 96

Multiple Choice

The purpose of a sinking fund is to:

• A) reduce the par value of stock over time.
• B) take advantage of the tax break on preferred stock.
• C) periodically retire debt prior to final maturity.
• D) allow risky corporations to avoid bankruptcy.

---

Definitions:

Extinction

The elimination of a species; occurs when the last individual member of a species dies; see background extinction and mass extinction.

Autotrophs

Organisms that produce their own food using light, water, carbon dioxide, or other chemicals.

Cyanobacteria

Photosynthetic microorganisms, also known as blue-green algae, that contribute significantly to the Earth's oxygen production.

Photosynthetic Organisms

Organisms that convert light energy into chemical energy through the process of photosynthesis, including plants, algae, and some bacteria.