Do Log_Slave_Updates in MySQL 5.7 fail the replication in Linux?

I have a Master Master replication setup in RHEL for 2 Nodes.One server is acting as Master as well as slave for another Server ( which is also Master and Slave ) Let us say A server and B server

I have enabled log_slave_updates on B server so that all the statements receiving from master ( Server A) should get logged to binary logs of server B .

I was expecting Replication , will get fail because :

         1. Created a Table on Server A.
         2. It get replicated to Server B.

Now Binary log from Slave B will go to Server A and this should break the replication saying "table already exist". but it didn't

What is the logic here ?

Edit Part :

1. Server id on both servers are different