What is fixed bond in SAP LO - Logistics - General?

SAP Term: fixed bond

• Component: LO

• Component Name: Logistics - General

• Description: An excise bond whose value is the total amount of basic excise duty BED that the bond can cover over its entire lifetime. Every time you post an export, the bond value is reduced by the BED amount. Eventually, the net bond value reaches zero and cannot be used any more. &EXAMPLE& You have an excise bond with a value of INR 10,000. You export some goods with a basic excise duty value of INR 8,000, then you export some more with a BED value of INR 2,000. The excise bond now expires.

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• Key Concepts: 
  A fixed bond is a type of financial instrument used in SAP Logistics. It is a contract between two parties, the issuer and the investor, in which the issuer agrees to pay a fixed amount of interest over a specified period of time. The investor then receives the interest payments at regular intervals. The fixed bond is typically used to finance long-term investments or to provide liquidity for short-term investments.
  
  How to use it: 
  In SAP Logistics, fixed bonds can be used to finance long-term investments or to provide liquidity for short-term investments. To create a fixed bond, the issuer must first define the terms of the bond, such as the interest rate, maturity date, and payment schedule. Once these terms are established, the issuer can then issue the bond and begin collecting payments from investors.
  
  Tips & Tricks: 
  When issuing a fixed bond, it is important to consider the creditworthiness of the issuer. This will help ensure that investors receive their payments on time and that the issuer is able to meet its obligations. Additionally, it is important to consider the tax implications of issuing a fixed bond as this may affect the amount of interest that can be earned by investors.
  
  Related Information: 
  Fixed bonds are just one type of financial instrument available in SAP Logistics. Other types of financial instruments include floating rate bonds, convertible bonds, and zero coupon bonds. Additionally, SAP Logistics also offers other types of financing options such as loans and lines of credit.