Home > Blossary: Long Term Debt
Long term debt is basically a loan that last for more than a year. It is a liability that a company or an individual holds which matures, or has to be paid back in not less than a year. Long term debt does come with interest payments, which is the cost of borrowing for the one who takes the debt, and a reward for the one that loans out the amount.

Category: Education

15 Terms

Created by: SingleWriter

Number of Blossarys: 3

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These are the agreements where a company can only pay a restricted amount of dividend, is not supposed to sell the senior debt first or use refunding as a tool to take new debt with low interest ...

Domain: Financial services; Category: Finance

These are used to safeguard the rights and interests of the bond holders. It is an added promise in the indenture that restricts behavior of the company regarding financial contracting.

Domain: Financial services; Category: Finance

Sinking funds have a feature of repayment every year. It is considered secure, but it does come with a risk of calls that turn out to be unfavorable.

Domain: Financial services; Category: Finance

These are those bonds that are issued at the same date and have a similar maturity date as well. Term bonds that have a call provision written in the indenture can be redeemed earlier than the other ...

Domain: Financial services; Category: Finance

This is a bond issue that matures in intervals, but evenly. Serial bonds are used by those companies that expect regular cash inflows in the future since it helps in principal repayments at maturity.

Domain: Financial services; Category: Finance

It is the process through which a bond is issued. The method is quite similar to that of public issue of stock, but in a public issue of bond an indenture is essential.

Domain: Financial services; Category: Finance

Indenture basically lists the features of a bond. It consists of the par value of the bond, amount and date of issue, and maturity of the bond. It also has details regarding coupon payments and other ...

Domain: Financial services; Category: Finance

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