Question - Assume a Legal Entity's capital structure consists of the following accounts:
Short-term note payable $ 200,000
Long-term note payable 500,000
Mandatorily redeemable preferred stock 350,000
Common stock 60,000
Additional paid-in capital 400,000
Retained earnings 280,000
Total liabilities and equity $1,790,000
What is the maximum amount of expected losses that the Legal Entity can expect to sustain without being considered a variable interest entity (VIE)?