Match the items below by entering the appropriate code letter in the space provi

Question

Match the items below by entering the appropriate code letter in the space provided. Long term liabilities issued against the general credit of the borrower Bonds that may be coverted into common stock at the bondholder's option Ofi-balance sheet financing The rate investors demand for loaning funds to a corporation Occurs when the contractual rate of interest is less than the market rate of interest. A measure of a company's short-term liquidity. Produces a periodic interest expense that is the same amount each interest period. A measure of a company's solvency Bonds subject to retirement at a stated dollar amount prior to maturity The time that the final payment on a bond is due from the bond issuer. A. Maturity date B. Times interest earned C. Callable bonds D. Market interest rate E. Straight-line method of amortization F operating leases G. convertible bonds H. Current ratio . Discount on bonds payable J. unsecured bonds

Explanation / Answer

1) Long term liabilities issued against the general credit of the borrower = (J) unsecored bonds

2) Bonds that may be converted into common stock at the bondholder's option = (G) Convertible Bonds

3) Off balance sheet financing = F) Operating Leases

4) The rate investors demand for loaning funds to a corporation = D) market Interest Rate

5) Occurs when the contractual interest rate is less than the market rate of interest = (I) Discount on bonds payable

6) A measure of company's short term liquidity = (H) Current Ratio

7) Produces a periodic interest expense that is the same amount each interest period = (E) Straight line method of amortization

8) A measure of company's solvency = (B) times Interest earned

9) Bonds subject to retirement at a stated dollar amount prior to maturity = (C) Callable Bonds

10) The time that final payment on a bond is due from the bond issuer = (A) maturity date

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