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Untitled Document17 - Bonds Payable

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Bonds Payable One source of financing available to corporations is long-term bonds. Bonds  represent an obligation to repay a principal amount at a future date and pay  interest, usually on a semi-annual basis. Unlike notes payable, which normally  represent an amount owed to one lender, a large number of bonds are normally  issued at the same time to different lenders. These lenders, also known as  investors, may sell their bonds to another investor prior to their maturity. Types of bonds There are many different types of bonds available to interested investors. Some  of the more common forms are:  * Serial bonds.  Bonds issued in groups that mature at different dates. For  example, $5,000,000 of serial bonds, $500,000 of which mature each year  from 5–14 years after they are issued.  * Sinking fund bonds.  Bonds that require the issuer to set aside a pool of 
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Untitled Document17 - Bonds Payable

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