Matching Questions 106. Match each of the following terms a through j with the appropriate definitions 1 through 10. 1. The difference between the par value of a bond and its higher issue price...

1. The difference between the par value of a bond and its higher issue price or carrying value

Bond indenture

2. Bonds that require the issuer to create a fund of assets at specified amounts and dates to repay the bonds at maturity

Annuity

3. The contract between the bond issuer and the bondholder(s); it identifies the rights and obligations of the parties

Callable bonds

4. Bonds that give the issuer an option of retiring them at a stated amount before the date of maturity

Sinking fund bonds

5. The interest rate specified in the bond indenture

Secured bonds

6. A series of equal payments at equal intervals

Debt to equity ratio

7. A written promise to pay an amount identified as the par value along with interest at a stated rate

Premium on bonds

8. Bonds that have specific assets of the issuer pledged as collateral

Contract rate

9. The ratio of total liabilities to total equity

Bond

10. The net amount at which bonds are reported on the balance sheet

Carrying value