Select the Key Term That Relate to Accounting for General

question 42

Essay

Select the key term that relate to accounting for general long-term liabilities and debt service from the list that best matches with the following definition.
A. Legal defeasance
B. Regular serial bonds
C. In-substance defeasance
D. Irregular serial bonds
E. Debt limit
F. Annuity serial bonds
G. Debt margin
________ 1. A transaction in which cash or other assets are placed into an irrevocable trust for the benefit of debt holders
________ 2. Bonds for which the amount of annual principal repayments is scheduled to increase each year by approximately the same amount that interest payments decrease
________ 3. Bonds payable in which the total principal is repayable in a specified number of equal annual installments
________ 4. The maximum amount of gross or net debt that is legally permitted
________ 5. A transaction in which debt is legally satisfied based on certain provisions in the debt instrument even though the debt has not been repaid

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Definitions:

Industrially Advanced Nations

Countries that have highly developed industries and infrastructure, often characterized by high levels of income, technological innovation, and standard of living.

Managed Float

A currency exchange rate policy where the central bank allows the currency value to fluctuate in the foreign exchange market but intervenes to prevent excessive movements.

Fixed Rate System

A monetary system in which exchange rates are set and maintained at a certain level by a government or central bank.

Flexible Exchange Rates

A system in which the worth of a currency is permitted to vary based on the foreign exchange market, free from direct governmental interference.