If bonds are issued at a discount, it means that the
a. bondholder will receive effectively less interest than the contractual rate of interest
b. market interest rate is lower than the contractual interest rate
c. market interest rate is higher than the contractual interest rate
d. financial strength of the issuer is suspect
c
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Which of the following statements is true with regard to early retirement of bonds?
a. If the carrying value of the bonds is higher than the redemption price, the issuing firm must record a loss. b. Firms always find it advantageous to retire bonds issued at lower rates with bonds issued at higher rates. c. It is always advantageous to carry out early retirement for bonds issued at a premium but not for bonds issued at a discount. d. Any gain or loss resulting from early retirement of bonds would appear on the income statement of the issuing company.
Just-in-time relationships between buyers and sellers usually require operational linkages and information sharing.
Answer the following statement true (T) or false (F)
Which of the following is the correct formula to compute residual income?
A) Average operating assets - Net operating income B) Average operating assets - (Net operating income x Minimum required rate of return) C) Net operating income x Minimum required rate of return D) Net operating income - (Average operating assets x Minimum required rate of return)
The textbook described mimicry, vicarious learning, scanning and grafting as ways to
a. Distribute knowledge b. Circulate knowledge c. Retain knowledge d. Acquire knowledge