Which of the following statements are true concerning variable interest entities (VIEs)?(1.) The role of the VIE equity investors can be fairly minor.(2.) A VIE may be created specifically to benefit the business enterprise that established it with low-cost financing.(3.) VIE governing agreements often limit activities and decision-making.(4.) VIEs usually have a well-defined and limited business activity.
A) 2 and 4.
B) 2, 3, and 4.
C) 1, 2, and 4.
D) 1, 2, and 3.
E) 1, 2, 3, and 4.

Question

Quizplus · Accepted Answer

All the statements are true regarding VIEs: equity investors can have a minor role, they can be created for low-cost financing, governing agreements often limit activities, and they usually have limited business activities.

Which of the Following Statements Are True Concerning Variable Interest