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- On April 1st, Tesla entered into a contract of one-month duration to build a barn for Amazon. Tesla is guaranteed to receive a base fee of $5,300 for his services in addition to a bonus depending on when the project is completed. Amazon created incentives for Tesla to finish the barn as soon as he can without jeopardizing the structural integrity of the barn. Amazon offered to pay an additional 30% of the base fee if the project finished 2 weeks early and 10% if the project finished a week early. The probability of finishing 2 weeks early is 30% and the probability of finishing a week early is 60%. What is the expected transaction price with variable consideration estimated as the expected value? Multiple Choice O $5,300 O $7,095 O $5,035 $6,095 GOn April 1st, Ma Construction entered into a contract of one-month duration to build a barn for Valley Properties. Ma is guaranteed to receive a base fee of $5,000 for its services in addition to a bonus depending on when the project is completed. Valley Properties created incentives for Ma to finish the barn as soon as they can without jeopardizing the structural integrity of the barn. Valley offered to pay an additional 30% of the base fee if the project finished 2 weeks early and 10% if the project finished a week early. The probability of finishing 2 weeks early is 30% and the probability of finishing a week early is 60%.What is the expected transaction price with variable consideration estimated as the most likely amount? Group of answer choices $5,000 $5,750 $5,500 $4,750Joseph Taylor, president of Carla Vista Always, agrees to construct a concrete cart path at Vaughn Golf Club. Carla Vista Always enters into a contract with Vaughn to construct the path for $202, 000. In addition, as part of the contract, a performance bonus of $46, 400 will be paid based on the timing of completion. The performance bonus will be paid fully if completed by the agreed - upon date. The performance bonus decreases by $11,600 per week for every week beyond the agreed - upon completion date. Joseph has been involved in a number of contracts that had performance bonuses as part of the agreement in the past. As a result, he is fairly confident that he will receive a good portion of the performance bonus. Joseph estimates, given the constraints of his schedule related to other jobs, that there is 50% probability that he will complete the project on time, a 30% probability that he will be 1 week late, and a 20% probability that he will be 2 weeks late. Assume that Joseph Taylor…
- John William, president of Crane Always, agrees to construct a concrete cart path at Windsor Golf Club. Crane Always enters into a contract with Windsor to construct the path for $212,000. In addition, as part of the contract, a performance bonus of $46,800 will be paid based on the timing of completion. The performance bonus will be paid fully if completed by the agreed-upon date. The performance bonus decreases by $11,700 per week for every week beyond the agreed-upon completion date. John has been involved in a number of contracts that had performance bonuses as part of the agreement in the past. As a result, he is fairly confident that he will receive a good portion of the performance bonus. John estimates, given the constraints of his schedule related to other jobs, that there is 50% probability that he will complete the project on time, a 30% probability that he will be 1 week late, and a 20% probability that he will be 2 weeks late. Determine the transaction price that Crane…Jeff Heun, president of Pina Always, agrees to construct a concrete cart path at Dakota Golf Club. Pina Always enters into a contract with Dakota to construct the path for $184,000. In addition, as part of the contract, a performance bonus of $36,400 will be paid based on the timing of completion. The performance bonus will be paid fully if completed by the agreed-upon date. The performance bonus decreases by $9,100 per week for every week beyond the agreed-upon completion date. Jeff has been involved in a number of contracts that had performance bonuses as part of the agreement in the past. As a result, he is fairly confident that he will receive a good portion of the performance bonus. Jeff estimates, given the constraints of his schedule related to other jobs, that there is 55% probability that he will complete the project on time, a 30% probability that he will be 1 week late, and a 15% probability that he will be 2 weeks late. Determine the transaction price that Pina…Sanjeev enters into a contract that pays him $1,000 each month for six months of continuous consulting services. In addition, there is a 40% chance the contract will pay an additional $3,000, depending on the outcome of the consulting contract. Sanjeev used the most likely amount to determine transaction price. After Sanjeev has recognized revenue for two months of the contract, he changes his assessment of the chance the contract will pay him $3,000 up to 70%. How much revenue would Sanjeev recognize in the third month of the contract? $2,500 O $1.500 $1,850 O $1,600
- Jeff Heun, president of Concrete Always, agrees to construct a concrete cart path at Dakota Golf Club. Concrete Always enters into a contract with Dakota to construct the path for $200,000. In addition, as part of the contract, a performance bonus of $40,000 will be paid based on the timing of completion. The performance bonus will be paid fully if completed by the agreed-upon date. The performance bonus decreases by $10,000 per week for every week beyond the agreed-upon completion date. Jeff has been involved in a number of contracts that had performance bonuses as part of the agreement in the past. As a result, he is fairly confident that he will receive a good portion of the performance bonus. Jeff estimates, given the constraints of his schedule related to other jobs, that there is 55% probability that he will complete the project on time, a 30% probability that he will be 1 week late, and a 15% probability that he will be 2 weeks late. Instructions a. Determine the transaction…Nair Corp. enters into a contract with a customer to build an apartment building for $1,000,000. The customer hopes to rent apartments at the beginning of the school year and provides a performance bonus of $150,000 to be paid if the building is ready for rental beginning August 1, 2021. The bonus is reduced by $50,000 each week that completion is delayed. Nair commonly includes these completion bonuses in its contracts and, based on prior experience, estimates the following completion outcomes: Completed by Probability August 1, 2021 70% August 8, 2021 20 August 15, 2021 5 After August 15, 2021 5 Determine the transaction price for this contract.Whispering Corp. enters into a contract with a customer to build an apartment building for $979,400. The customer hopes to rent apartments at the beginning of the school year and provides a performance bonus of $144,300 to be paid if the building is ready for rental beginning August 1, 2021. The bonus is reduced by $48,100 each week that completion is delayed. Whispering commonly includes these completion bonuses in its contracts and, based on prior experience, estimates the following completion outcomes: Completed by Probability August 1, 2021 70 % August 8, 2021 20 August 15, 2021 5 After August 15, 2021 5 Determine the transaction price for this contract. Transaction Price $enter the transaction price for this contract
- Jeff Heun, president of Wildhorse Always, agrees to construct a concrete cart path at Dakota Golf Club. Wildhorse Always enters into a contract with Dakota to construct the path for $233,000. In addition, as part of the contract, a performance bonus of $42,800 will be paid based on the timing of completion. The performance bonus will be paid fully if completed by the agreed-upon date. The performance bonus decreases by $10,700 per week for every week beyond the agreed-upon completion date. Jeff has been involved in a number of contracts that had performance bonuses as part of the agreement in the past. As a result, he is fairly confident that he will receive a good portion of the performance bonus. Jeff estimates, given the constraints of his schedule related to other jobs, that there is 55% probability that he will complete the project on time, a 30% probability that he will be 1 week late, and a 15% probability that he will be 2 weeks late. a.) Determine the transaction…Jeff Heun, president of Flint Always, agrees to construct a concrete cart path at Dakota Golf Club. Flint Always enters into a contract with Dakota to construct the path for $238,000. In addition, as part of the contract, a performance bonus of $34,000 will be paid based on the timing of completion. The performance bonus will be paid fully if completed by the agreed-upon date. The performance bonus decreases by $8,500 per week for every week beyond the agreed-upon completion date. Jeff has been involved in a number of contracts that had performance bonuses as part of the agreement in the past. As a result, he is fairly confident that he will receive a good portion of the performance bonus. Jeff estimates, given the constraints of his schedule related to other jobs, that there is 50% probability that he will complete the project on time, a 25% probability that he will be 1 week late, and a 25% probability that he will be 2 weeks late.ssume that Jeff Heun has reviewed his work schedule…Robinson Corp. enters into a contract with a customer to build an apartment building for $990,500. The customer hopes to rent apartments at the beginning of the school year and provides a performance bonus of $147,300 to be paid if the building is ready for rental beginning August 1, 2026. The bonus is reduced by $49,100 each week that completion is delayed. Robinson commonly includes these completion bonuses in its contracts and, based on prior experience, estimates the following completion outcomes: Completed by August 1, 2026 August 8, 2026 August 15, 2026 After August 15, 2026 Transaction price $ Probability Transaction price 70 % $ 20 (a) Determine the transaction price for the contract, assuming Robinson is only able to estimate whether the building can be completed by August 1, 2026, or not (Robinson estimates that there is a 70% chance that the building will be completed by August 1, 2026). 5 5 (b) Determine the transaction price for the contract, assuming Robinson has limited…