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! Problem 3: (Show all supporting comentations Fields Advertising Associates signs a 5-year contract with Abbot Manufacturing, Inc. for 56,000,000 which is payable evenly at the end of each of the next five years. Under the terms of the agreement Fields will promote Abbot's products in print television, and social media. Fields will receive a bonus based on Abbot's cumulative sales levels at the end of the contract. The bonus if any is paid at the end of the contract. The terms of the bonus agreement are presented below. Cumulative Sales Bonus Level Bonus as a percent of 56,000,000 Percentage $40,000,000 35% $2,100,000 30,000,000 20% 1.200.000 15,000,000 12% 720.000 10,000,000 10% 600,000 Fields estimates the probabilities of reaching each of the cumulative sales levels as follows Fields estimates the probabilities of reaching each of the cumulative alesh as fotos nts Cumulative Sales Sales Level Level Probability $40.000.000 30.000.000 40% 15.000.000 30% 10,000,000 SX REQUIRED a. Prepare all journal entries necessary to record the contractat deception and at the end of Year 1 ming that the Expected Value Method is used. You do not need to consider the variabile consideration is constrained b. Prepare all journal entries necessary to record the contractat inception and at the end of Year 1 at the Most Likely Amount Method is used. You must consider the estimate of the amount of variable consideration constrained in this part of the