Which of the Following Statements Is (Are) Correct? (More Than

question 206

Multiple Choice

Which of the following statements is (are) correct? (More than one statement may be correct.)

• A) A bond issue is a technique for subdividing a very large loan into a great many small, transferable units.
• B) Bond interest payments are contractual obligations, whereas the board of directors determines whether or not dividends will be paid.
• C) As interest rates rise, the market prices of bonds fall; as interest rates fall, bond prices tend to rise.
• D) Bond interest payments are deductible in determining income subject to income taxes, whereas dividends paid to stockholders are not deductible.

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Definitions:

Statutory Assignment

A legal transfer of a right from one party to another, made under and governed by statutory law.

Negotiable Instrument

A written document guaranteeing the payment of a specific amount of money either on demand or at a set time.

Fraudulent Misrepresentation

A false statement made knowingly, without belief in its truth, or recklessly, carelessly whether it is true or false, with the intent that someone else would rely on it and suffer loss.

Intentionally Misleading

Deliberately providing false or deceptive information.