BONDED DEBT, that portion of the indebtedness of a government or subdivision of government, or of a business, firm or corporation which is represented by outstanding bonds. This is often known as the "funded debt." The bonds representing the bonded or funded debt create a fixed financial charge in the form of interest, which, in a business, must be met at each period to prevent foreclosure ; hence, care must always be taken to avoid issuing more bonds than can be properly cared for.