On the Due Date for Bond Interest,the Debt Service Fund

question 41

Multiple Choice

On the due date for bond interest,the debt service fund journal entry (or entries) will include:

• A) A debit to Bonds Payable.
• B) A debit to Interfund Transfers Out.
• C) A debit to Expenditures-Bond Interest.
• D) A debit to Interest Expense.

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Definitions:

Yield To Maturity

The total return expected on a bond if held until its maturity date, including all remaining coupon payments and principal repayment.

Remaining Maturity

The amount of time left until a financial instrument, such as a bond, reaches its maturity date and the principal is due to be repaid.

Coupon Rate

The annual interest rate payable on a bond's face value by its issuer, representing the yield paid to bondholders.

Par Value

A nominal value assigned to a security by the issuer, often used in the context of bonds or stock.