The publisher Sorbaline launches new software that it has never yet sold separately and for which it has not yet set a price. It sells it to a first customer together with installation and one year of support, for 100,000. The three items are distinct performance obligations. Installation and support are regularly sold on their own, at 12,000 and 18,000 respectively. Sorbaline estimates the stand-alone selling price of the software using the residual approach. Compute that estimated price.
- Total contract price
- 100,000
- Observable stand-alone selling price of the installation
- 12,000
- Observable stand-alone selling price of the support
- 18,000