Question

Enter the letter of the description A through H that best fits each term or phrase 1 through 8.

A. Records and tracks the bondholders’ names.

B. Is unsecured; backed only by the issuer’s credit standing.

C. Has varying maturity dates for amounts owed.

D. Identifies rights and responsibilities of the issuer and the bondholders.

E. Can be exchanged for shares of the issuer’s stock.

F. Is unregistered; interest is paid to whoever possesses them.

G. Maintains a separate asset account from which bondholders are paid at maturity.

H. Pledges specific assets of the issuer as collateral.

1. Registered bond 5. Convertible bond

2. Serial bond 6. Bond indenture

3. Secured bond 7. Sinking fund bond

4. Bearer bond 8. Debenture

Short answer

1. Registered bond	A
2. Serial bond	C
3. Secured bond	H
4. Bearer bond	F
5. Convertible bond	E
6. Bond indenture	D
7. Sinking fund bond	G
8. Debenture	B

Step-by-step solution

Meaning of Bond

A bond is a written agreement in which the issuer must pay a specified amount of money on a fixed date as stated in the agreement.

Detailed explanation

Types of bonds	Description	Explanation
1. Registered bond	A. Records and tracks the bondholders’ names	A Bond issued with the name and other details like the address of the bondholder is a registered bond.
2. Serial bond	C. Has varying maturity dates for amounts owed	Serial bonds have a schedule in which the particular portion of the bonds matures at a definite interval, and the process continues till all the bonds mature.
3. Secured bond	H. Pledges specific assets of the issuer as collateral	Secured bonds are those issued to investors, and the issuer provides an asset as collateral security for the bond.
4. Bearer bond	F. Is unregistered; interest is paid to whoever possesses them	Bearer bonds are the bonds in which the name of the bondholder is not mentioned.
5. Convertible bond	E. Can be exchanged for shares of the issuer’s stock	Convertible bonds are the bonds that can be convertible into common stock.
6. Bond indenture	D. Identifies rights and responsibilities of the issuer and the bondholders	A bond indenture is a document that contains the rights and obligations of the issuing company and the bondholders.
7. Sinking fund bond	G. Maintains a separate asset account from which bondholders are paid at maturity	Sinking fund bonds are bonds in which the company keeps aside a certain amount to pay the maturity amount on the maturity date to the bondholders.
8. Debenture	B. Is unsecured; backed only by the issuer’s credit standing	Debentures are a company's loans issued to raise money for a particular period.