A Variable-Interest Entity Has

question 95

Multiple Choice

A variable-interest entity has

• A) insufficient equity investment at risk.
• B) stockholders who have decision-making rights.
• C) stockholders who absorb the losses or receive the benefits of a normal stockholder.
• D) All of the above are characteristics of a variable-interest entity.

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Definitions:

Banker

A professional in the banking industry who deals with the management, operation, and provision of banking services to consumers and businesses.

Contra Asset Account

This is an account used in financial accounting to offset the balance of a related asset account, increasing the overall accuracy of the company's financial statement.

Accumulated Depreciation

The sum of all depreciation expenses allocated for a physical asset from the time it was first utilized.

Depreciation Expense

The systematic write-off of the cost of a tangible asset over its useful life.