In: Accounting
Question: What does it mean when a company calls a bond?
Step 1: Definition of bond
A bond is a type of long-term liability in which the company issues a bond to fulfill a large number of money needs.
Step 2: Bond call
When a company calls a bond, it means the company redeems its bond before the maturity date of the bonds. When a company call bond, it pays face value plus the accrued interest to the investor
A company called bond when there are chances that the interest rate will fall in the future.