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On March 1, Arachnids Inc. enters into a contract with a customer to build a website for its start-up business for $50,000, plus a possible
On March 1, Arachnids Inc. enters into a contract with a customer to build a website for its start-up business for $50,000, plus a possible performance bonus. The contract includes the creation of the website as a platform to display and sell the customer's products. The pricing of the customized website project includes a performance bonus of $5,000 to be paid to Arachnids Inc. If the website is completed by May 31 . The performance bonus will be reduced for each week beyond the due date (up to 4 weeks). Based on Arachnids Inc.'s historical experience and the assessment of its current capabilities, the following outcomes are estimated. Indicate which method is appropriate in estimating the variable consideration. Estimate the transaction price for Arachnids Inc.'s revenue contract
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