1)
FASB
ASC 1-1 Variable Interest Entities
In this chapter, we discuss how Enron and other companies
used special-purpose entities (SPEs) to keep the effects of transactions and
events off corporate balance sheets. Accounting for SPEs is now guided by the
requirements for variable interest entities (VIEs).
How does the FASB define a VIE? In other words, how does an
entity qualify to be a VIE?
Is a company that meets the definition of a VIE required to
consolidate the VIE?
2)
Case 2-5 Definition of Assets
Your company owns a building that is fully paid for. Explain
how the building meets the definition of an asset under each of the following
scenarios.
Required:
Your company is using the building as a plant that is
producing automobiles.
Your company is not using the building but plans to sell it.
Explain how the building meets the definition of an asset.
Your company is not using the building but plans to remodel
it so that it can be used as a plant to produce automobiles.
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