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Understanding Generally Accepted Accounting Principles Is Not Necessary to Effectively

question 86

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Understanding generally accepted accounting principles is not necessary to effectively use and interpret financial statements.


Definitions:

Face Value

The amount the corporation must repay to the bondholder at the maturity date.

Interest

The cost of using money for a period of time.

Convertible Bonds

These are corporate bonds that holders can convert into a predetermined number of shares of the issuing company's stock, combining features of both debt and equity.

Specified Exchange Rate

A predetermined rate at which two currencies will be exchanged in a financial transaction.

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