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Lisa is interested in an oil drilling opportunity that costs $150,000 and anticipates financing 75%...

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Accounting

Lisa is interested in an oil drilling opportunity that costs $150,000 and anticipates financing 75% of the cost by applying for a non-recourse loan available through venture X. Regarding this type of activity,

a. if Lisa obtains commercial insurance against the risk she is undertaking, she in effect will not be "at-risk" for any amount invested

b. if the oil drilling venture is a failure, venture capital can only recover $37,500 from Lisa

c. Lisa is nevertheless subject to "at-risk" rules in the amount of $122,500 minus her down payment

d. Lisa must file application with the IRS in order to have non-recourse financing approved for tax purposes

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