Aztec Company contracted with the Kirk Company to review their revenue recognition policies for recording sales. The contract will pay Aztec

$900,000

in the form of a fixed fee. Aztec will also receive $150,000 additionally if Kirk achieves $200,000 in additional revenues. Aztec estimates a

65%

chance that Kirk Company will achieve $200,000 in additional revenues. Refer to Aztec Company. Assume that Aztec estimates that the transaction price is the most likely value. The transaction price is ________.

A.

$1,050,000

B.

$997,500

C.

$900,000

D.