Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Can you please provide complete steps/work? Question 1 Jeff Heun, president of Teal Always, agrees to construct a concrete cart path at Dakota Golf Club.
Can you please provide complete steps/work?
Question 1 Jeff Heun, president of Teal Always, agrees to construct a concrete cart path at Dakota Golf Club. Teal Always enters into a contract with Dakota to construct the path for $181,000. In addition, as part of the contract, a performance bonus of $39,600 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 $9,900 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 60% probability that he will complete the project on time, a 25% probability that he will be 1 week late, and a 15% probability that he will be 2 weeks late. s po other jobs , that (a) Determine the transaction price that Teal Always should compute for this agreement. Transaction Price $ Question 2 Riverbed Biotech enters into a licensing agreement with Pang Pharmaceutical for a drug under development. Riverbed will receive a payment of $11,500,000 if the drug receives regulatory approval. Based on prior experience in the drug-approval process, Riverbed determines it is 90% likely that the drug will gain approval and a 10% chance of denial. (a) Determine the transaction price of the arrangement for Riverbed Biotech. Transaction price Click if you would like to Show Work for this question: Open Show Work
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started