The following nominal accounts apply to a primary beneficiary company and a VIE: Primary Company VIE Company Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .(800,000) (240,000) Service fees . . . . . . . . . . . . . . . . . . . . . . . (150,000) Interest revenue . . . . . . . . . . . . . . . . . . . (90,000) Interest expense. . . . . . . . . . . . . . . . . . . . 50,000 Operating expenses . . . . . . . . . . . . . . . 550,000 230,000 Depreciation expense . . . . . . . . . . . . . 100,000 40,000 The fair value of the VIE assets had a fair value $100,000 higher than book value on the date control was achieved. The asset adjusted had a 5 year life. The VIE agrees to distribute a share of its income to the primary beneficiary equal to 10% of sales revenue and service fees. Prepare income distribution schedules for the Primary and VIE Companies.
The following nominal accounts apply to a primary beneficiary company and a VIE:
Primary Company VIE Company
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .(800,000) (240,000)
Service fees . . . . . . . . . . . . . . . . . . . . . . . (150,000)
Interest revenue . . . . . . . . . . . . . . . . . . . (90,000)
Interest expense. . . . . . . . . . . . . . . . . . . . 50,000
Operating expenses . . . . . . . . . . . . . . . 550,000 230,000
The fair value of the VIE assets had a fair value $100,000 higher than book value on the date control was achieved. The asset adjusted had a 5 year life.
The VIE agrees to distribute a share of its income to the primary beneficiary equal to 10% of sales revenue and service fees.
Prepare income distribution schedules for the Primary and VIE Companies.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
