51. Bonds that have interest coupons attached to their certificates, which the bondholders detach during each interest period and present to a bank for collection, are called:
A. Coupon bonds.
B. Callable bonds.
C. Serial bonds.
D. Convertible bonds.
E. Clip and Carry bonds.
52. Bonds owned by investors whose names and addresses are recorded by the issuing company and for which interest payments are made with checks to the bondholders, are called:
A. Callable bonds
B. Serial bonds
C. Registered bonds
D. Coupon bonds
E. Bearer bonds
53. The contract between the bond issuer and the bondholders, which identifies the rights and obligations of the parties, is called a(n):
A. Debenture
B. Bond indenture
C. Mortgage
D. Installment note
E. Mortgage contract
54. Bonds that mature at different dates and end up with the total principal repaid gradually over a number of periods are referred to as:
A. Registered bonds
B. Bearer bonds
C. Callable bonds
D. Sinking fund bonds
E. Serial bonds
55. Bonds with a par value of less than $1,000 are known as:
A. Junk bonds
B. Baby bonds
C. Callable bonds
D. Unsecured bonds
E. Convertible bonds
56. Using the debt to equity ratio, which of the following franchises would be assessed as having the riskiest financing structure?
|
Franchise A
|
Franchise B
|
Franchise C
|
Franchise D
|
Franchise E
|
Total liabilities
|
$240,000
|
$120,000
|
$300,000
|
$500,000
|
$270,000
|
Total equity
|
$60,000
|
$20,000
|
$150,000
|
$100,000
|
$90,000
|
A. Franchise A
B. Franchise B
C. Franchise C
D. Franchise D
E. Franchise E
57. What is the debt to equity ratio for a company that has $700,000 in total liabilities and $3,500,000 in total equity?
A. 20%
B. 5
C. $2,100,000
D. 2%
E. .5
58. When a bond sells at a premium:
A. The contract rate is above the market rate.
B. The contract rate is equal to the market rate.
C. The contract rate is below the market rate.
D. It means that the bond is a zero coupon bond.
E. The bond pays no interest.
59. A bond sells at a discount when the:
A. Contract rate is above the market rate.
B. Contract rate is equal to the market rate.
C. Contract rate is below the market rate.
D. Bond has a short-term life.
E. Bond pays interest only once a year.
60. A company issues 9%, 20-year bonds with a par value of $750,000. The current market rate is 9%. The amount of interest owed to the bondholders for each semiannual interest payment is.
A. $0
B. $33,750
C. $67,500
D. $750,000
E. $1,550,000