ACC-202 Lecture Notes - Lecture 39: Accounts Receivable, Sinking Fund
19 Apr 2016
School
Department
Course
Professor
Document Summary
Indenture = legal contract that exists between the person/firm who issues the bond and the person/firm who buys the bond. ****describes whether the bond is secure/ unsecure, callable/ non-callable, convertible/non-convertible. ****need to know what each of these would mean. Term bond = on the date that is listed on the front of the bond- you are going to get the full amount of the stated/face amount due at maturity. ^sinking fund = an account that management can put money into but can"t take it out. = ensures that management doesn"t push it off to a future date. It ensures that when the bonds are due they have the money. Serial bond = the amount you see on the face will be paid over a number of years. Don"t get it as a lump sum. When the bond matures you will get the last payment. Term bonds pay a higher interest rate because they are more risky.
