Final answer:
The principal amount of a bond is payable on the maturity date, which is the specific date agreed upon for the payback of the bond's face value along with the last interest payment.
Step-by-step explanation:
The specified date on which the principal amount of a bond is payable is referred to as the maturity date. A bond, essentially an "I owe you" note, is an instrument through which an investor lends capital to an entity in exchange for periodic interest payments and the return of the bond's face value on the maturity date. The face value is the agreed amount to be repaid by the borrower to the investor at maturity. This face value, combined with the coupon rate (or interest rate), and the prevailing market interest rates, allows for the computation of the bond's present value, which indicates how much a buyer is willing to pay for the bond at any given time.