Crane Biotech enters into a licensing agreement with Windsor Pharmaceutical for a drug under development. Crane will receive a payment of $8,600,000 if the drug receives regulatory approval. Based on prior experience in the drug-approval process, Crane determines it is 85% likely that the drug will gain approval and a 15% chance of denial. (a) Determine the transaction price of the arrangement for Crane Biotech. Transaction price eTextbook and Media List of Accounts. Attempts: of 5 used