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Match Each Definition with the Correct Term Below

question 20

Short Answer

Match each definition with the correct term below.
a.
A security that represents money that a corporation borrows from the investing public.
b.
A long-term debt secured by real property.
c.
Bonds that are issued in the name of the bondholder.
d.
The method of bond amortization that uses a constant interest rate each period to amortize the bond premium or discount.
e.
Bonds that do not require periodic interest payments but instead promise to pay a fixed amount at the maturity date.
f.
The excess of the face value over the issue price of a bond.
g.
A contract that requires a company to pay benefits to its employees after they retire.
h.
The excess of the issue price over the face value of a bond.
i.
A liability or an asset that results from using different methods to calculate income taxes on the income statement and income tax liability on the income tax return.
j.
The method of bond amortization that equalizes amortization of a bond discount or premium for each interest period over the life of the bond.
-Deferred income taxes

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Definitions:

Prepaid Expenses

Upfront costs incurred for items or services that are to be obtained in the upcoming time.

Accrued Expenses

Expenses that have been incurred but not yet paid, representing liabilities on the balance sheet.

Assets

Assets are resources controlled by a company as a result of past events and from which future economic benefits are expected to flow to the entity.

GAAP

Set of accounting standards and principles designed to ensure consistency, fairness, and transparency in financial reporting.

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