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A clothing manufacturer (a VIE entity) has two equity holders. Profits and losses of the VIE are split according to ownership percentage; therefore, Equity holder
A clothing manufacturer (a VIE entity) has two equity holders. Profits and losses of the VIE are split according to ownership percentage; therefore, Equity holder 1 receives 51 percent and Equity holder 2 receives 49 percent of the profits and/or losses. Equity holder 1 controls all decisions regarding distributing clothing in fulfillment of sales negotiated by Equity holder 2 on the VIE's behalf. Equity holder 2 controls all decisions regarding the design, manufacturing, pricing, and sales of the clothing.
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The primary beneficiary of a VIE entity is the party that has the most control o...
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Financial Accounting an introduction to concepts, methods and uses
Authors: Clyde P. Stickney, Roman L. Weil, Katherine Schipper, Jennifer Francis
13th Edition
978-0538776080, 324651147, 538776080, 9780324651140, 978-0324789003
