Answer:

Company need a money for  many reason .i.e expansion of the business, Day to day activity ,for capital budgeting etc. Issue of a bond is one of the way to raise a money. A bond  has its function same like a  loan . I mean to say it work like loan between an investor and a corporation

In the issue of a bond investor are agree to give the company specific amount of money for particular time period  in exchange of  interest payment at the frequent interval

Issue of a bond for raising a money and not to use other option for raising money is driven by many factors.

In  bonds  companies company have more freedom to use it the way which deemed fit  and also it free from the restrictions that we can see in  bank loans.

In case of bond company can continue to issue new bonds as against to this in case stock there are may restriction on the issue of new stock

Bond  attract a large number of lenders. Its record keeping is simple

Corporation have also benefit of flexibility in bond . A quick look at some of the variations highlights this flexibility.