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BE8-8. Estimating Variable Consideration. Sellet Billboard Company entered into an agreement to display bill. board advertising for Wynne Incorporated for 10 months for a $60,000
BE8-8. Estimating Variable Consideration. Sellet Billboard Company entered into an agreement to display bill. board advertising for Wynne Incorporated for 10 months for a $60,000 fixed fee. The agreement also includes a potential bonus based on certain goals. Sellet believes the following probability estimates on receiving a bonus are accurate: Expected bonuss 1600 20% = Bonus Probability $8,000 $6,000 - 58% - 3,980 580 $4,000 > 17% = 680 $2,000 5% = 100 What approach should Sellet use to estimate variable consideration? What is the estimate of the consideration amount in this contract
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