In Terms of Public Offerings of Bonds,what Is an Indenture

question 33

Multiple Choice

In terms of public offerings of bonds,what is an indenture?

• A)a list of the duties of the trust company representing the bondholders' interests
• B)a memorandum that must be produced to describe the details of a bond offering
• C)a formal contract that specifies the firm's obligations to the bondholders
• D)a schedule of the fees charged by the underwriting company
• E)a registration filing with the securities commission

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Definitions:

Non-interest-bearing Note

A promissory note or loan agreement that does not require the borrower to pay interest, only to repay the principal amount.

Book Value Method

An accounting technique that determines the value of an asset based on its original cost minus any depreciation, amortization, or impairment costs.

Par Value

The face value of a bond or stock, as stated on the certificate, which is the amount paid out at maturity for bonds, or the stated value per share for stocks.

Additional Paid-in Capital-Common Stock

This represents the amount investors have paid above the nominal or par value of common stock, reflecting additional equity contributed to the company.