Concord Biotech enters into a licensing agreement with Pang Pharmaceutical for a drug under development. Concord will receive a payment of $8,300,000 if the drug receives regulatory approval. Based on prior experience in the drug-approval process, Concord determines it is 95% likely that the drug will gain approval and a 5% chance of denial.

Determine the transaction price of the arrangement for Concord Biotech.

Transaction price

$

that regulatory approval was granted on December 20, 2017, and that Concord received the payment from Pang on January 15, 2018, the journal entries for Concord. The license meets the criteria for point-in-time revenue recognition.