Question

1)Which of the following was not true according to the Enron case?

a)The SPE created by Fastow enabled Enron to keep debt off its books while benefiting from transfer and use of the cash borrowed by the SPE

b)Fastow developed the concept of buying up oil and gas companies to establish SPEs

c)Fastow created SPEs that borrowed money from banks and transferred it to Enron in a sale of an operating asset no longer need by Enron

d)Fastow worked to structure ventures that met the conditions under GAAP to keep the partnership activities off Enron's books and on the separate books of the partnership

2)Which of the following partnerships that Enron created eventually lead to its demise?

a)Chewco

b)Cactus

c)JEDI

d) Ironman

Answer 1

1. Answer is option b.

Fastow developed the concept of buying up oil and gas companies to establish SPEs.

2. Answer is option A Chewco.