What is Bonds Payable?

Bonds payable is a liability account that has amount awed to bond holders by the issuer. It is a financial instrument used by the business or governments to secure long term capital. These bonds represent the amount owed by the issuer to bondholders. They have a specified maturity date, at which point the principal amount is repaid. Throughout the bond’s lifespan, periodic interest rate. Bonds payable serve as a borrowing method for issuers and offer investors a means to earn fixed income. They are actively trade in financial markets, providing liquidity to bondholders.

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