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| Randolf Castell opened a small general store in A cousin, Alfred Bedford, served as bookkeeper and office manager while Castell concentrated on operations. The business prospered and each of Castell’s three sons joined their father in the business. In fact, as each son finished school, Castell opened a new store and put the son in charge. In time, each son began to specialize: one in hardware, another in dry goods, and the third in furniture. Further expansion took place, and the business was incorporated as Four Castles Inc., with all of the stock being held by the family. Castell closed his original store to serve as president and concentrate on administration. As Four Castles prospered and more stores opened, the company needed additional capital. Bedford suggested "going public" but pointed out that this required accounting and reporting procedures with which he was unfamiliar. Therefore, a trained and qualified accountant was hired as controller. The new controller has had to provide explanations to Castell and Bedford on the accounting and reporting requirements of public companies. From the viewpoint of the investor, which of the following securities provides the least risk? A. Mortgage bond. B. Subordinated debenture. C. Income bond. D. Debentures. |