-The Short-Term Debt Consists of 4-Year Bonds Paying an Annual

question 21

Multiple Choice

-The short-term debt consists of 4-year bonds paying an annual coupon of 4 percent and selling at par. What is the duration of the short-term debt?

• A)3.28 years.
• B)3.53 years.
• C)3.78 years.
• D)4.03 years.
• E)4.28 years.

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Definitions:

Accounts Payable

The amount a company owes to suppliers or vendors for goods or services received that haven't yet been paid for.

Receiving Report

A document used to confirm the receipt of goods delivered, typically matched against the purchase order to ensure accuracy.

Purchase Order

The document authorizing the purchase of inventory from an approved vendor.

Sales Invoice

A document issued by a seller to a buyer, detailing a transaction and requesting payment, itemizing the products or services provided and their prices.