Which of the Following Statement Concerning Treasury Bonds Is True

question 47

Multiple Choice

Which of the following statement concerning Treasury bonds is true?

• A)They are priced and sold at auction.
• B)Interest accumulates and is paid out at maturity.
• C)They are more risky than comparable maturity private bonds.
• D)They have higher rates than comparable municipal bonds.

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Definitions:

Deferred Tax Asset

An accounting term that refers to a situation where a company has paid more taxes to the government than it has shown as an expense in its financial statements, leading to future tax savings.

Deferred Tax Liability

A tax obligation that a company owes but is allowed to pay at a later date, often due to timing differences between accounting practices and tax laws.

Future Tax

Tax liabilities or assets that are expected to be realized in the future, typically as a result of temporary differences between the book and tax bases of assets and liabilities.

Tax Effect Method

An accounting approach for recognizing the income tax consequences of transactions and events in the same period as the transactions and events.