Please show how to solve this question. Ware Brass Corp. (WBC) is a...
60.1K
Verified Solution
Link Copied!
Question
Accounting
Please show how to solve this question.
Ware Brass Corp. (WBC) is a wholesaler that sells musical instruments to retailers. On February 1 of the current year, W contracts with Lemer Extravaganza, Inc. (LEI) to sell 1,400 trumpets to L with delivery scheduled for the month of February. The contract price is $700 per trumpet. However, the contract includes the possibility of a volume discount if total annual purchases exceed a given amount. These discounts are as follows: (Click the icon to view the discount percentage.) (Click the icon to view additional information.) Using the most-likely-amount approach, what is the estimate of the consideration amount in this contract? The estimate of consideration amount in the contract is $ 950,600 - Probability estimates - X Discount percentage Discount Percentage These discounts are retroactive-once a volume trigger is met, WBC refunds to LEI amounts on previous purchases. WBC believes that it is 18% likely that it will not contract with LEI again this year. WBC believes the following probability estimates are accurate: Total Sales Probability If Total Sales Equal or Exceed $1,280,000 $2,080,000 $4,580,000 3% 4% 8% $ 980,000 18% $ 1,280,000 46% $ 22% % Print Done 2,080,000 4,580,000 $ 14%
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
