ACC 201 ch 9

Card Set Information

Author:
gabo
ID:
154228
Filename:
ACC 201 ch 9
Updated:
2012-05-16 15:14:03
Tags:
Long Term Liabilities
Folders:

Description:
Glossary
Show Answers:

Home > Flashcards > Print Preview

The flashcards below were created by user gabo on FreezingBlue Flashcards. What would you like to do?


  1. Amortization schedule p. 426
    Provides a summary of the cash interest payments, interest expense, and changes in carrying value for debt instruments.
  2. Bond p. 413
    A formal debt instrument that obligates the borrower to repay a stated amount, referred to as the principal or face amount, at a specified maturity date.
  3. Bond indenture p. 414
    A contract between a firm issuing bonds and the corporations or individuals who purchase the bonds.
  4. Callable p. 415
    A bond feature that allows the borrower to repay the bonds before their scheduled maturity date at a specified call price.
  5. Capital lease p. 434
    Contract in which the lessee essentially buys an asset and borrows the money through a lease to pay for the asset.
  6. Capital structure p. 412
    The mixture of liabilities and stockholders' equity in a business.
  7. Carrying value p. 425
    The balance in the bonds payable account, which equals the face value of bonds payable minus the discount or the face value plus the premium.
  8. Convertible p. 415
    A bond feature that allows the lender (or investor) to convert each bond into a specified number of shares of common stock.
  9. Debt financing p. 412
    Obtaining additional funding from lenders.
  10. Debt to equity ratio p. 435
    Total liabilities divided by total stockholders' equity; measures a company's risk.
  11. Default risk p. 418
    The risk that a company will be unable to pay the bond's face amount or interest payments as it becomes due.
  12. Discount p. 418
    A bond's issue price is below the face amount.
  13. Early extinguishment of debt p. 430
    The issuer retires debt before its scheduled maturity date.
  14. Equity financing p. 412
    Obtaining additional funding from stockholders.
  15. Installment payment p. 432
    Includes both an amount that represents interest and an amount that represents a reduction of the outstanding balance.
  16. Lease p. 433
    A contractual arrangement by which the lessor (owner) provides the lessee (user) the right to use an asset for a specified period of time.
  17. Market interest rate . p. 416
    Represents the true interest rate used by investors to value a bond
  18. Operating lease p. 433
    Contract in which the lessor owns the asset and the lessee simply uses the asset temporarily.
  19. Premium x p. 420
    Premium A bond's issue price is above the face amount. p. 420
  20. Private placement. p. 413
    Sale of debt securities directly to a single investor
  21. Return on assets p. 437
    Net income divided by average total assets; measures the income generated per dollar of assets.
  22. Return on equity . p. 437
    Net income divided by average stockholders' equity; measures the income generated per dollar of equity
  23. Secured bonds Bonds p. 414
    that are supported by specific assets pledged as collateral.
  24. Serial bonds Bonds p. 414
    that require payment of the principal amount of the bond over a series of maturity dates.
  25. Sinking fund . p. 414
    An investment fund used to set aside money to be used to pay debts as they come due
  26. Stated interest rate p. 416
    The rate quoted in the bond contract used to calculate the cash payments for interest.
  27. Term bonds p. 414
    Bonds that require payment of the full principal amount of the bond at a single maturity date.
  28. Times interest earned ratio . p. 438
    Ratio that compares interest expense with income available to pay those charges
  29. Unsecured bonds p. 414
    Bonds that are not supported by specific assets pledged as collateral.

What would you like to do?

Home > Flashcards > Print Preview