A Trial Balance Consists Of

question 3

Multiple Choice

A trial balance consists of:

• A)A two-column schedule of all debit and credit entries posted to ledger accounts.
• B)A two-column financial statement intended for distribution to interested parties outside the business.
• C)A two-column schedule showing the totals of all debits and of all credits made in journal entries.
• D)A two-column schedule listing names and balances of all ledger accounts.

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Definitions:

Conversion Ratio

The conversion ratio is the number of shares an investor receives when converting a convertible security, such as a convertible bond or preferred stock, into common stock.

Bond Indenture

A legal contract detailing the terms and conditions under which a bond is issued, including the obligations of the issuer and the rights of the bondholders.

Sinking Fund

A sinking fund is a method by which a company sets aside money over time to retire its preferred stock, bonds, or debentures before or at maturity, to ensure investment security for bondholders.

Callable Feature

A provision on a bond that allows the issuer to repurchase and retire its bonds before they mature.