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Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN: 9781337788281
Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher: Cengage Learning
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Harrid Corp. enters into a contract with a customer to build an apartment building for $1,039,000. The customer hopes to rent
apartments at the beginning of the school year and provides a performance bonus of $148,200 to be paid if the building is ready for
rental beginning August 1, 2026. The bonus is reduced by $49,400 each week that completion is delayed. Harrid commonly includes
these completion bonuses in its contracts and, based on prior experience, estimates the following completion outcomes:
Completed by
August 1, 2026
Probability
70 %
August 8, 2026
20
August 15, 2026
5
After August 15, 2026
5
Determine the transaction price for this contract.
Transaction price
$"
Transcribed Image Text:Current Attempt in Progress
Harrid Corp. enters into a contract with a customer to build an apartment building for $1,039,000. The customer hopes to rent
apartments at the beginning of the school year and provides a performance bonus of $148,200 to be paid if the building is ready for
rental beginning August 1, 2026. The bonus is reduced by $49,400 each week that completion is delayed. Harrid commonly includes
these completion bonuses in its contracts and, based on prior experience, estimates the following completion outcomes:
Completed by
August 1, 2026
Probability
70 %
August 8, 2026
20
August 15, 2026
5
After August 15, 2026
5
Determine the transaction price for this contract.
Transaction price
$
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