Transaction price for contract-sunland corp

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Reference no: EM132421018

Sunland Corp. enters into a contract with a customer to build an apartment building for $1,069,900. The customer hopes to rent apartments at the beginning of the school year and provides a performance bonus of $153,300 to be paid if the building is ready for rental beginning August 1, 2021. The bonus is reduced by $51,100 each week that completion is delayed. Sunland commonly includes these completion bonuses in its contracts and, based on prior experience, estimates the following completion outcomes:

Completed by Probability

August 1, 2021 70%

August 8, 2021 20

August 15, 2021 6

After August 15, 2021 4

What is the transaction price for this contract.

Reference no: EM132421018

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