QUESTION 20 Illustration 20–Estimating variable consideration AST Limited enters into a contract with a customer to build a manufacturing facility. The entity determines that the contract contains one performance obligation satisfied over time. Construction is scheduled to be completed by the end of the 36th month for an agreed-upon price of $ 25 Million. The entity has the opportunity to earn a performance bonus for early completion as follows: • 15 percent bonus of the contract price if completed by the 30th month (25% likelihood) • 10 percent bonus if completed by the 32nd month (40% likelihood) • 5 percent bonus if completed by the 34th month (15% likelihood) In addition to the potential performance bonus for early completion, AST Limited is entitled to a quality bonus of $ 2 million if a health and safety inspector assigns the facility a gold star rating as defined by the agency in the terms of the contract. AST Limited concludes that it is 60% likely that it will receive the quality bonus. Determine the transaction price.