Which of the following is a true statement related to variable interests as defined in the variable interest accounting model?

a. Only senior debt instruments with fixed rates absorb substantial variability in another entity's assets.

b. Guarantees of specific assets may be variable interests.

c. Options exercisable at fair value are variable interests.

d. Options to purchase equity at a fixed "strike price" may be variable interests.

Which of the following is a true statement related to applying Topic 805 Business Combination initial recognition and measurement principles in consolidating a variable interest entity?

a. Leases and insurance contracts are classified based on terms and conditions at the initial consolidation date.

b. The general measurement principle applied is fair value, with limited exceptions.

c. Any noncontrolling interests are not recognized.

d. Recognize a separate valuation allowance as of the initial consolidation date for assets measured at fair value (such as receivables).

Which of the following is an appropriate fair presentation concept related to a primary beneficiary's consolidation of a variable interest entity?

O a. Intra-entity balances are not eliminated, but are disclosed.

b. Separately report by natural classification all assets of each consolidated variable interest entity from those of the primary beneficiary.

c. Separately report by natural classification liabilities of a consolidated variable interest entity for which creditors do not have recourse to the general credit of the primary beneficiary.

d. Separate presentation of assets and liabilities of the consolidated VIE is not permitted.

Which of the following is a true statement related to ASU 2018-17 related to a nonpublic business entity's guidance for accounting for variable interest entities?

a. A nonpublic business entity is permitted to not consolidate any legal entity, including entities that it directly or indirectly has a controlling financial interest.

b. A nonpublic business entity is prohibited from consolidating any variable interest entities.

c. As long as both the reporting business entity and the legal entity being evaluated for consolidation as a variable interest entity are not public business entities, or are not under common control of a public business entity, it is optional to consolidate variable interest entities.

d. The accounting alternative can be applied on a case-by case basis for current and future entities under common control.