Sinking Fund Bonds

question 59

Multiple Choice

Sinking fund bonds:

• A)Require the issuer to set aside assets in order to retire the bonds at maturity.
• B)Require equal payments of both principal and interest over the life of the bond issue.
• C)Decline in value over time.
• D)Are registered bonds.
• E)Are bearer bonds.

---

Definitions:

Net Assets

The total assets of an entity minus its total liabilities, indicating the entity’s net worth or equity.

Common Stock

Equity securities that represent ownership interests in a corporation, providing voting rights and entitling the holder to a share of the company's success through dividends and/or capital appreciation.

Expense Recognition

An accounting principle that dictates the conditions under which expenses are recognized and reported in financial statements.