Which of the following is an accurate statement about the variable interest accounting model ?

a. Voting interest control is required for consolidation. b. The model foouses primorily on evaluating power and

C. An entity's exposure to potentially significant gains and losses is

d. Power to direct an entity's key activities is not relevant to the variable interest model.

Which of the following will most likely be exempt from the need to evaluate whether the variable interest entity consolidation is required?

a. The reporting entity has a relationship with a legal entity that does not meet the defiltion of a business.

b. The reporting entity has a relationship with a legal entity that meets the definition of a business.

c. The reporting entity has a relationship with an entity that is not capable of being managed for the purpose of providing a return directly to investors.

d. The reporting entity has a relationship with a legal entity that does not have inputs and processes capable of producing outputs.

Which of the following would most likely be a strong indicator that substantially all of a legal entity's activities either involve or are conducted on behalf of the reporting entity and its related parties.

a. The reporting entity holds a fixed-price "out-of-the-money" put option related to the entity's equity investments.

b. The reporting entity does not have an economic interest in the entity's research and development activities.

c. The principal purpose of the entity is to conduct a uniquely complementary operation of the reporting entity's business operations.

d. Profit participation is shared equally with the reporting entity and others.

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 an accurate statement about the variable interest accounting model ?

a. Voting interest control is required for consolidation. b. The model foouses primorily on evaluating power and

C. An entity's exposure to potentially significant gains and losses is

d. Power to direct an entity's key activities is not relevant to the variable interest model.

Which of the following will most likely be exempt from the need to evaluate whether the variable interest entity consolidation is required?

a. The reporting entity has a relationship with a legal entity that does not meet the defiltion of a business.

b. The reporting entity has a relationship with a legal entity that meets the definition of a business.

c. The reporting entity has a relationship with an entity that is not capable of being managed for the purpose of providing a return directly to investors.

d. The reporting entity has a relationship with a legal entity that does not have inputs and processes capable of producing outputs.

Which of the following would most likely be a strong indicator that substantially all of a legal entity's activities either involve or are conducted on behalf of the reporting entity and its related parties.

a. The reporting entity holds a fixed-price "out-of-the-money" put option related to the entity's equity investments.

b. The reporting entity does not have an economic interest in the entity's research and development activities.

c. The principal purpose of the entity is to conduct a uniquely complementary operation of the reporting entity's business operations.

d. Profit participation is shared equally with the reporting entity and others.

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.