Question

Zero-coupon bonds: Offer a return in the form of a deep discount off the face value. Are reported as shareholders' equity by the issuer. Result in zero interest revenue for the investor. Result in zero interest expense for the issuer.

Answer 1

Offer a return in form the form of a deep discount off the face value

Step-by-step explanation:

The term deep discount bonds in financial accounting refers to indentures that are sold at a price reasonably lower than face value, normally 20% or more than that. Deep discount bonds also has a zero coupon bonds, which do not pay a rate of interest to the holder of the bond. They are usually issued for a period of five(5) years on more than that.