Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

11. Long Term Liabilities

Introduction to Bonds and Bond Characteristics

Financial Accounting

11. Long Term Liabilities

Introduction to Bonds and Bond Characteristics

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Multiple Choice

Which of the following organizations used bonds to issue new mortgages to families currently in default and to prevent foreclosure?

Federal Reserve Bank

Internal Revenue Service (IRS)

Securities and Exchange Commission (SEC)

Federal National Mortgage Association (Fannie Mae)

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Verified step by step guidance

Understand the context of the question: The problem is asking about an organization that uses bonds to issue new mortgages to families in default to prevent foreclosure. This involves financial instruments and government-backed entities.

Review the options provided: Federal Reserve Bank, Internal Revenue Service (IRS), Securities and Exchange Commission (SEC), and Federal National Mortgage Association (Fannie Mae). Each organization has distinct roles in the financial system.

Clarify the role of Fannie Mae: Fannie Mae is a government-sponsored enterprise (GSE) that focuses on expanding access to affordable housing. It achieves this by purchasing mortgages from lenders, bundling them into mortgage-backed securities, and selling them to investors. This process helps provide liquidity to the mortgage market.

Eliminate incorrect options: The Federal Reserve Bank primarily manages monetary policy and regulates banks, not mortgages. The IRS handles tax collection and enforcement, unrelated to mortgage issuance. The SEC oversees securities markets and protects investors, but does not directly deal with mortgages.

Conclude that Fannie Mae is the correct answer: Based on its role in the housing market and its use of bonds to support mortgage issuance, Fannie Mae is the organization that fits the description in the problem.