Question

1. Premium
2. Times interest earned ratio

3. Sinking fund

4. Market interest rate
5. Discount

6. Stated interest rate

7. Capital lease

8. Amortization schedule

9. Operating lease

10. Debt to equity ratio

The rate quoted in the bond contract used to calculate the cash payments for interest.

The lessor owns the asset and the lessee simply uses the asset temporarily.

Total liabilities divided by total stockholders' equity; measure a company's risk.

The true interest rate used by investors to value a bond.

The issue price is below its face amount.

Provides a summary of the cash interest payments, interest expense, and changes in carrying value for debt

instruments.

The lessee essentially buys an asset and borrows the money through a lease to pay for the asset.

The issue price is above its face amount.

Ratio that compares interest expense with income available to pay those charges.

An investment fund used to set aside money to be used to pay debts as they come due.

Answer 1

Matching

a	The rate quoted in the bond contract used to calculate the cash payments for interest.	Stated interest rate
b	The lessor owns the asset and the lessee simply uses the asset temporarily.	Operating lease
c	Total liabilities divided by total stockholders' equity; measure a company's risk.	Debt equity ratio
d	The true interest rate used by investors to value a bond.	Market interest rate
e	The issue price is below its face amount.	Discount
f	The issue price is below its face amount. Provides a summary of the cash interest payments, interest expense, and changes in carrying value for debt instruments.	Amortization schedule
g	The lessee essentially buys an asset and borrows the money through a lease to pay for the asset.	Capital lease
h	The issue price is above its face amount.	Premium
i	Ratio that compares interest expense with income available to pay those charges.	Times interest earned ratio
j	An investment fund used to set aside money to be used to pay debts as they come due.	Sinking fund