BJL operate a national chain of seafood restaurants in R-land where the currency is the R$. As you work through the Statement of Financial Position you see two types of debt: bonds and a bank loan and you call the Finance Director to get a few more details. The Finance Director explains that the bonds balance of R$1,000,000 relates to 15 per cent bonds, secured on BJL's inventory and with a requirement that the company maintain a current ratio above a fixed value of 2. The balance of R$500,000 relates to a 12 per cent bank loan, secured on BJL's property portfolio. The bank has suggested it would be helpful to see the accounts wherever possible. Which THREE statements are correct in respect of BJL's charges and covenants? Solution A.The bonds carry a floating charge. B.The bank loan carries a fixed charge. C.The bonds have a covenant attached. D.The bank loan has a covenant attached. E.The bonds would rank higher than the bank loan on winding up