Answer
a) A corporation can obtain funds by issuing bonds and other long-term note payables.
b) A bond indenture is a legal contract entered into by the issuer and and bondholder. It spells out the terms of the bond, such as the maturity date and coupon rate, and any restrictions, such as covenants.
c) A mortgage is a legal document that describes the collateral for a loan (e.g. a house). If the loan is defaulted upon the creditor has the right to seize the collateral.
Work Step by Step
a) Other long-term note payables can include mortgages and long-term loans.
