Advanced Financial Accounting
Advanced Financial Accounting
11th Edition
ISBN: 9780078025877
Author: Theodore E. Christensen, David M Cottrell, Cassy JH Budd Advanced Financial Accounting
Publisher: McGraw-Hill Education
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Chapter 3, Problem 3.2.1E

Multiple-Choice Question on Variable Interest Entities

Select the correct answer for each of the following question.

1. Special-purpose entities generally

a. Have a much larger portion of assets financed by equity shareholders than do companies such as General Motors.

b. Have relatively large amounts of preferred stock and convertible securities outstanding.

c. Have a much smaller portion of their assets financed by equity shareholder than do companies such as General Motors.

d. Pay out a relatively high percentage of their earnings as dividends to facilitate the sale of additional shares.

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