Question

Atlas Entertainment has 15-year bonds outstanding. The interest payments on these bonds are sent directly to each of the individual bondholders. These direct payments are a clear indication that the bonds can accurately be defined as being issued:

1) at par.
2) in registered form.
3) in street form.
4) as debentures.
5) as callable

Answer 1

The direct payment of interest to individual bondholders signifies that Atlas Entertainment's bonds are issued in registered form, with a record of each bondholder maintained by the company.

Step-by-step explanation:

When Atlas Entertainment sends interest payments directly to each individual bondholder, it indicates that the bonds are issued in registered form. This means that the company keeps a register of all bondholders and their contact information, ensuring that interest payments are distributed to the proper parties.

This is unlike bonds issued in street form, where the bonds are held in the name of a brokerage or other nominee, rather than the actual investor. Therefore, the choice that accurately defines these bonds, given that interest payments are sent directly to the bondholders, is option 2) in registered form.