On June 1, 2021, Emmet Property Management entered into a 2-year contract 1o oversee

#casing and maintenance for an apartment buildine. The contract starts on July 1, 2021, Under

the terms of the contract, Emmet will be paid a fixed fee of $50,000 per year and will receive an

additional 15% of the fixed fec at the end of each year provided that building occupancy exceeds

20%. Emmet estimates a 30% chance it will exceed the occupancy threshold, and concludes the

revenue recognition over time is appropriate for this contract.

Assume Emmet estimates variable consideration as the most likely amount. How much revenue

should Emmet recognize on this contract in 2021?

A) $25,000

B) $26,125

C) $28,750

d) $50.000