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3/30/2020 Shaky Construction Corp. enters into a contract with a customer to build a warehouse for $500,000 with a performance bonus of $30,000 if the
3/30/2020 | Shaky Construction Corp. enters into a contract with a customer to build a warehouse | ||||
for $500,000 with a performance bonus of $30,000 if the warehouse is completed by | |||||
July 31, 2020. The bonus is reduced by $10,000 each week that completion is delayed. | |||||
Shaky commonly includes these completion bonuses in its contracts, and, based on | |||||
prior experience estimates the following completion outcomes: | |||||
Completed by | Probability | ||||
31-Jul | 60% | ||||
7-Aug | 30% | ||||
14-Aug | 10% | ||||
21-Aug | 5% | ||||
THE TRANSACTION PRICE FOR THIS CONTRACT IS | _______________________ |
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