Sparks Corporation entered into a contract with a customer to build a warehouse for $863,000....
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Sparks Corporation entered into a contract with a customer to build a warehouse for $863,000. There is an additional performance bonus of $75,000 if the job is finished on time. If the job is finished a week later the bonus is reduced to $50,000 and if two weeks late the bonus is $10,000. There is a 50% probability that the job will be finished on time, a 40% probability that is will be completed one week late and a 10% chance that it will be completed two week late. What is the contract price for the warehouse?
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