Multiple Choice
Which of the following is not a factor that indicates a business enterprise that establishes a variable interest entity (VIE) should consolidate such VIE with its own financial statements?
A) The business enterprise establishing a VIE has the obligation to absorb potentially significant losses of the VIE.
B) The business enterprise establishing a VIE receives risks and rewards of the VIE in proportion to equity ownership.
C) The business enterprise establishing a VIE has the right to receive potentially significant benefits of the VIE.
D) The business enterprise establishing a VIE has power through voting rights to direct the entity's activities that significantly impact economic performance.
E) The business enterprise establishing a VIE is a primary beneficiary for the VIE.
Correct Answer:
Verified
Correct Answer:
Verified
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