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There are instances where a subsidiary issued bonds prior to becoming part of an affiliated...

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Accounting

There are instances where a subsidiary issued bonds prior to becoming part of an affiliated group. The parent company may decide to purchase these bonds at a later date from the holders as an investment. When these bonds were issued, they were sold at a discount.

My question to you is, why would a Parent want to purchase bonds for an investment if now the bonds are selling at a Premium? What is the incentive for the Parent company to hold these bonds?

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