✓ ALLOCATION COMPLETE · Σ $1,150,000

Step 4 · Allocate transaction price to performance obligations

Per ASC 606-10-32-31, allocation is by relative standalone selling price. Each PO has its own SSP determination method (observable / market-assessment / cost-plus-margin / residual). The total of allocations equals the transaction price. Σ SSPs equals contract price → no discount allocation required.

PO-1 · Subscription license

$1,008,000

87.7% of TP · Observable price

PO-2 · Onboarding implementation

$84,400

7.3% of TP · Cost-plus-margin

PO-3 · Premium support

$57,600

5.0% of TP · Observable price

Subscription license to NorthStar Platform

SSP method · Observable price

$1,008,000

87.7% of TP

✓HIGH

Method · Observable price

ASC 606-10-32-32 — best evidence is the price at which the entity sells the same good or service separately to similar customers in similar circumstances.

When to use: Use when the same good/service is regularly sold standalone at a published or transactable price.

SSP value

$1,008,000

Provenance: List price for 250-user enterprise tier × 36 months. Verified against 14 prior NorthStar deals (median $28K/mo).

Allocation math · deterministic engine

SSP for this PO:$1,008,000

Σ SSPs (all POs):$1,150,000

Allocation ratio:$1,008,000 / $1,150,000 = 87.7%

Total transaction price:$1,150,000

Allocated TP for PO-1:$1,008,000

judgment_id 018f2a4b7c80…View full reasoning trace →

Onboarding implementation services

SSP method · Cost-plus-margin

$84,400

7.3% of TP

◐MEDIUM

Method · Cost-plus-margin

ASC 606-10-32-34(b) — forecast costs of providing the good or service plus an appropriate margin.

When to use: Use when neither observable nor market evidence is available; common for custom services like onboarding.

SSP value

$84,400

Provenance: 420 implementation hours × $145 blended rate + 32% margin. Comparable third-party implementers price within ±8%.

Allocation math · deterministic engine

SSP for this PO:$84,400

Σ SSPs (all POs):$1,150,000

Allocation ratio:$84,400 / $1,150,000 = 7.3%

Total transaction price:$1,150,000

Allocated TP for PO-2:$84,400

judgment_id 018f2a4b7c80…View full reasoning trace →

Premium support tier (24×7)

SSP method · Observable price

$57,600

5.0% of TP

✓HIGH

Method · Observable price

ASC 606-10-32-32 — best evidence is the price at which the entity sells the same good or service separately to similar customers in similar circumstances.

When to use: Use when the same good/service is regularly sold standalone at a published or transactable price.

SSP value

$57,600

Provenance: Premium-tier support is a published SKU at $1,600/mo × 36 months.

Allocation math · deterministic engine

SSP for this PO:$57,600

Σ SSPs (all POs):$1,150,000

Allocation ratio:$57,600 / $1,150,000 = 5.0%

Total transaction price:$1,150,000

Allocated TP for PO-3:$57,600

judgment_id 018f2a4b7c80…View full reasoning trace →

Allocation analyses · ASC 606-10-32-36 to 32-41

Discount allocationASC 606-10-32-36 to 32-38

Σ SSPs ($1,150,000) equals total transaction price ($1,150,000) — no discount applied at the contract level. The proportional-vs-specific decision (3-criteria test) is not triggered.

✓Not applicable

Variable-consideration allocationASC 606-10-32-39 to 32-41

Variable consideration was determined to be $0 in Step 3. Allocation of variable consideration to specific POs (2-criteria test) is not triggered.

✓Not applicable

Material rights allocationASC 606-10-55-41 to 55-45

Renewal is auto-renewal at CPI-indexed pricing (max 7%/yr) per §5. This does not constitute a material right because the customer pays then-current pricing — they do not receive a discount they would not otherwise be entitled to.

✓No material rights

Residual approach guardrailASC 606-10-32-34(c)

Residual approach was not selected for any PO. SSP method per PO: observable (PO-1, PO-3) and cost-plus-margin (PO-2). Residual is restricted to highly-variable-priced or never-sold-standalone goods/services.

✓Not used