Why would we record a bond a premium or discount?

Q: What is investment-grade bond?

A: Bond is a financial instrument. Issuer issues bond to raise the fund and payback the amount at the…

Q: What is a mortgage pay-through bond (MPTB)?

A: Mortgage Pay-through bond: MPTBs (Mortgage Pay-through bonds) are delivered in contradiction of…

Q: How are bonds amortized?

A: Bond Amortization: Over the course of the bond's existence, the principal (face value) of the loan…

Q: Why consider bonds?

A: A bond can be described as the security or asset which provides secure income to the investor…

Q: What is the difference between face rate and market rate, and which rate would be higher if a bond…

A: There are many types of financial instruments issued to raise funds.

Q: How does the payment of a bank loan’s principal and a bond’s par value differ?

A: A bank loan is a common method and process for a business to acquire money and capital for various…

Q: How should discount on bonds payable be reported on the financial statements? Premium on bonds…

A: Concept: A premium on bonds occurs if, the bonds are issued at a high price than the face value. On…

Q: What is the difference between a note and a bond?

A: Both Note and bond are issued by treasury.These are interchangeably used terms as there is no legal…

Q: What is original issue discount (OID) bond?

A: It is the amount of difference between the amount due at maturity and purchase value. These bonds…

Q: What is the stated rate for a bond?

A:

Q: What is the principal repayment for a bond

A: There are two components principal and interest

Q: What is a bond payable?

A: Long-Term LiabilitiesLong-term liabilities are the obligations of the business that need not be paid…

Q: How does the carrying value of a bond gets amortized when selling it at discount?

A: The carrying value of bond represents the amount of Bond Face Value + unamortized premium (or )–…

Q: What is new issue bond?

A: The bond is a fixed income financial instrument that is issued by the government or by the companies…

Q: What is a term bond?

A: Bonds: Bonds are long-term promissory notes that are issued by a company while borrowing money from…

Q: What amount of interest is expensed on a bond interest payment?

A: Whenever an interest payment is made on bonds, amount of interest expensed : Interest expensed =…

Q: How do bond ratings affect the default risk premium?

A: A premium which is paid by the borrower to its lender in the form of compensation of lender’s money…

Q: what is difference between a bond and a term loan? what are the advantages of a term loan over a…

A: A bond is a fixed-income security that speaks to credit to a borrower (normally corporate or…

Q: What is outstanding bond?

A: Bond: It can be defined as the loan given to a business or any other organization by the investor…

Q: What does it mean to amortize a bond premium or discount? Why is it necessary?

A: Introduction: A bond is a contract between the bond lender and the bondholders. The two most common…

Q: Explain Mortgage pay-through bonds (MPTBs)?

A: A written agreement through which a lender gets the right to take the property that is put as a…