Business Finance
business and finance question

Question Description

Why do companies issue bonds? What is the determining factor of whether a bond is sold at a discount, face, or premium?  How are discounts and premiums recorded and shown on the balance sheet?

Final Answer

Bonds may be issued at face value and are a form of interested-bearing notes payable issued by corporations and unversities. Bonds, like common stock are usually sold in small denominations like in multiples of $1000 us dollars. Unsecured bonds are issued against the general credit of the borrower. While secured bonds have the specific assets of the issuer pledged as collateral bonds. The discount and payable bonds will always appear on the balance sheet showing that it has a discount and or it has been payed off.

Gabriel E (1551)
University of Virginia

Top quality work from this tutor! I’ll be back!

Heard about Studypool for a while and finally tried it. Glad I did caus this was really helpful.

Thank you! Reasonably priced given the quality


Brown University

1271 Tutors

California Institute of Technology

2131 Tutors

Carnegie Mellon University

982 Tutors

Columbia University

1256 Tutors

Dartmouth University

2113 Tutors

Emory University

2279 Tutors

Harvard University

599 Tutors

Massachusetts Institute of Technology

2319 Tutors

New York University

1645 Tutors

Notre Dam University

1911 Tutors

Oklahoma University

2122 Tutors

Pennsylvania State University

932 Tutors

Princeton University

1211 Tutors

Stanford University

983 Tutors

University of California

1282 Tutors

Oxford University

123 Tutors

Yale University

2325 Tutors