Which of the following statements concerning bond features is (are)correct?
I.Bondholders generally have voting power in a corporation.
II.Bond interest is tax-deductible as a business expense.
III.The repayment of the bond principal is tax-deductible.
IV.Failure to pay either the interest payments or the bond principle as agreed can cause a firm to go into bankruptcy.

Question

Quizplus · Accepted Answer

I is incorrect as bondholders typically do not have voting power in a corporation.
II is correct as bond interest is tax-deductible as a business expense.
III is incorrect as the repayment of the bond principal is not tax-deductible.
IV is correct as failure to pay interest or bond principal as agreed can cause a firm to go into bankruptcy.

Which of the Following Statements Concerning Bond Features Is (Are)correct