Which one of the following statements concerning sinking funds is correct? Selec

ID: 2709339 • Letter: W

Question

Which one of the following statements concerning sinking funds is correct?

Select one:

a. Sinking funds are used solely to accumulate the funds needed to payoff bonds on the maturity date.

b. Sinking funds, when established, must be structured such that the entire bond issue is retired prior to the maturity date.

c. Sinking funds can only be used to call bonds.

d. Sinking funds are managed by a third party agent, an institution not connected to the company.

e. Bond issuers must fund any required sinking fund at the time the bonds are issued.

Sinking funds are used solely to accumulate the funds needed to payoff bonds on the maturity date.

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