When a corporation issues a bond,it is
A)Issuing dividends to shareholders.
B)Lending money to the owners of the corporation.
C)Borrowing funds from the initial buyer of the bond.
D)Making an initial public offering.

Question

Quizplus · Accepted Answer

When a corporation issues a bond, it is borrowing funds from the initial buyer of the bond. The corporation promises to pay back the principal plus interest to the bondholder at a specified future date. Unlike dividends, bond payments do not represent a share in ownership of the corporation.

When a Corporation Issues a Bond,it Is