The most common type of long-term debt is a
A)note payable.
B)bond payable.
C)mortgage payable.
D)pension.

Question

Quizplus · Accepted Answer

The most common type of long-term debt is bond payable. Bonds are issued by companies, municipalities and governments as a way to raise money for various purposes. They typically have a fixed interest rate and a maturity date, which is the date when the issuer must repay the principal amount to the bondholders. Unlike notes payable and mortgages payable, which are usually obtained from banks and other financial institutions, bonds are sold to investors in the capital markets. Pension is not a type of debt, rather it is a type of retirement benefit plan funded by employers.

The Most Common Type of Long-Term Debt Is a