Types of Bonds
In your own words, what is a bond?
A bond is a type of note that includes keywords such as: face value and maturity. It is typically smaller than a note but acts very similar to it
What is a bond above face value called?
What is a premium?
What is the Return on Common Equity Formula?
(Net Income - Preferred Dividends) / AVG common stock equity
In your own words, what is treasury stock?
Stocks that have been repurchased by the company and are not eligible for dividends.
In your own words, what is a dividend?
When a company pays out its stockholders. It reduces Retained Earnings (RE)
What type of bond can be converted by the lender into another security, typically into common stock?
What is a discount?
What is the Debt to Equity Formula?
Total Liabilities/ Total Equity
What are the max number of shares a company can be issued called?
What are the two ways a corporation can pay its stockholders?
Cash or Stocks
What type of bond has some collateral (ex: Real Estate)?
What is a secured bond?
What is the current offered price called?
What is slated?
What is the Debt to Total Assets Formula?
Total Liabilities/ Total Assets
What are the actual amount of shares in the public hands called?
What is outstanding shares?
Small dividends are what percentage?
What type of bond has no collateral? Also known as debenture or junk bonds and has a high risk of failed payment.
What bond gets credited?
What is the Times Interest Earned Formula (accrual basis)?
Operating Income/ Interest Expense
List the advantages of being a preferred stockholder.
1- it is less risky
2-they have priority in payment
Small dividends: what rate do you use when calculating RE?
What is market price?
What type of bond can be payed before its due date?
What is a callable bond?
What bond gets debited?
What is Discount bonds?
What is the Interest Net of Income Taxes Formula?
(100-Tax Rate) X Interest
List the advantages of being a common stockholder.
1- voting rights
2-call provisions
Large dividends: what rate do you use to calculate RE?