Secured bonds:
A) Are called debentures.
B) Have specific assets of the issuing company pledged as collateral.
C) Are backed by the issuer's bank.
D) Are subordinated to those of other unsecured liabilities.
E) Are the same as sinking fund bonds.

Question

Quizplus · Accepted Answer

Secured bonds have specific assets of the issuing company pledged as collateral. Debentures are a type of unsecured bond. Secured bonds are not necessarily backed by the issuer's bank, and they are not subordinated to other unsecured liabilities. Sinking fund bonds are a type of bond that requires the issuer to set aside funds regularly to retire the bonds at maturity, but they are not the same as secured bonds.

Secured Bonds