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Exerclse 18-5 Jeff Heun, president of Sage Always, agrees to construct a concrete cart path at Dakota Golf Club. Sage Always enters into a contract
Exerclse 18-5 Jeff Heun, president of Sage Always, agrees to construct a concrete cart path at Dakota Golf Club. Sage Always enters into a contract with Dakota to construct the path for $206,0OD. In addition, as part of the contract, a performance bonus of $32,400 will be paid based on the timing of completion. The performance bonus will be paid fully f completed by the agreed upon date. The performance bonus decreases by8 100 per week for every eek 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 estimate g en the constraints of his schedule related to otherjob that there is 60% probability that he will complete the pr ect on time, a 30% probability that he will be 1 eek late, and a 10% probability that he will be 2 eeks late. de bomus ail be eret onp cted by the seny coent at he wl r coe ve 00 priban iay the rtw Your answer is incorrect. Try again. Determine the transaction price that Sage Aways should compute for this agreement. Transaction Price x Your answer is incorect. Try again. Assume that JeIT Heun has reviewed his work schedule and decided that it makes sense to complete this project on time. Assuming that he now believes that the probability for campleting the project on time is 91 finished 1 week late, determine the transaction price. and otherwise it will be Transaction price Click if you would like to Show Work for this question: QRen Show Work
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