What Is Death Spiral Debt? Death spiral debt describes a type of convertible bond that forces the creation of an ever-increasing number of shares, inevitably leading to a steep drop in the price of shares. In general, convertible debt is a bond that yields interest but also can be converted to a number of stock
What Are Death Taxes? Death taxes are taxes imposed by the federal and some state governments on someone’s estate upon their death. These taxes are levied on the beneficiary who receives the property in the deceased’s will or the estate which pays the tax before transferring the inherited property. Death taxes are also called death
What Is Debasement? Debasement refers to lowering the value of a currency. It is primarily associated with coins made from precious metals, such as gold and silver. A currency is debased when the coins are made with a mix of precious metals and base metals as opposed to purely precious metals. The more base metals
What Is a Debenture? A debenture is a type of bond or other debt instrument that is unsecured by collateral. Since debentures have no collateral backing, they must rely on the creditworthiness and reputation of the issuer for support. Both corporations and governments frequently issue debentures to raise capital or funds. Key Takeaways A debenture
A debit is an accounting entry that results in either an increase in assets or a decrease in liabilities on a company’s balance sheet. In fundamental accounting, debits are balanced by credits, which operate in the exact opposite direction. For instance, if a firm takes out a loan to purchase equipment, it would simultaneously debit
What Is a Debit Balance? The debit balance in a margin account is the total amount of money owed by the customer to a broker or other lender for funds borrowed to purchase securities. The debit balance is the amount of cash the customer must have in the account following the execution of a security
What Is a Debt Cancellation Contract (DCC)? A debt cancellation contract (DCC) is a contractual arrangement modifying loan terms. Under the DCC, a bank agrees to cancel all or part of a customer’s obligation to repay a loan or credit. These contracts become effective upon the occurrence of a specified event as written into the contract, and
What Is a Debit Memorandum? A debit memorandum, or “debit memo,” is a document that records and notifies a customer of debit adjustments made to their individual bank account. The adjustments made to the account reduce the funds in the account but are made for specific purposes and used only for adjustments outside of any
What Is a Debit Note? A debit note is a document used by a vendor to inform the buyer of current debt obligations, or a document created by a buyer when returning goods received on credit. The debit note can provide information regarding an upcoming invoice or serve as a reminder for funds currently due.
What Is a Debit Spread? A debit spread, or a net debit spread, is an options strategy involving the simultaneous buying and selling of options of the same class with different strike prices requiring a net outflow of cash, or a “debit,” for the investor. The result is a net debit to the trading account. Here, the
