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Fire Masters entered into a licensing agreement with Ingrid Industries for a fire resistant material under development. Fire Masters will receive $8,100,000 if the new

Fire Masters entered into a licensing agreement with Ingrid Industries for a fire resistant material under development. Fire Masters will receive $8,100,000 if the new material receives regulator's approval. Assume it is 85% likely that the approval will be granted. The transaction price of this arrangement is

a.$8,100,000.

b.$6,885,000.

c.$1,215,000.

d.$0 until approval is received.

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