135k views
5 votes
The _ provides the evidence of debt nd mortgage provides the creditors security of the notes.

a. Balance sheet
b. Income statement
c. Stock certificate
d. Bond indenture

User Navjot
by
7.9k points

1 Answer

2 votes

Final answer:

The bond indenture is the document that evidences debt and provides security for creditors, distinguishing it from a balance sheet, which records a company's financial position, including its debts and assets.

Step-by-step explanation:

The document that provides evidence of debt and offers creditors security for that debt is known as the bond indenture. A bond is a financial contract in which a borrower agrees to repay the amount borrowed along with interest over a future period. In a real estate context, a mortgage acts as a secured loan where the property is the collateral. The balance sheet, on the other hand, lists a company's assets and liabilities and does not serve as evidence of debt. Instead, it reflects the company's financial position at a given point in time, including assets such as cash, the money held at the Federal Reserve bank, and liabilities such as mortgages.

User Ninnemannk
by
7.7k points