Skip to main content

Documentation Index

Fetch the complete documentation index at: https://docs.dualentry.com/llms.txt

Use this file to discover all available pages before exploring further.

​
Configure Allocations and Standalone Selling Price

DualEntry uses standalone selling price (SSP) to allocate a contract’s transaction price across its performance obligations. You configure SSP on each item record, and DualEntry handles the proportional math whenever you create or modify a contract.

​
What standalone selling price means in DualEntry

SSP is the price at which you would sell a product or service independently - outside the context of a bundled arrangement. Under ASC 606, SSP is the basis for allocating the transaction price when a contract contains multiple performance obligations. In DualEntry, you define the SSP on each item record. When you add that item as an obligation on a contract, DualEntry reads its SSP to compute allocations. The SSP you set is a stored value; DualEntry does not estimate it for you. SSP matters most when the total contract price differs from the sum of the individual SSPs. In that scenario, DualEntry allocates proportionally so that each obligation receives its fair share of the discount or premium. If your contracts always price each line at its standalone value, allocation has no net effect - but the system still runs the calculation to ensure compliance.

​
Set SSP on an item

You configure SSP directly on the item record so every future contract that references the item inherits the value.
  1. Navigate to Settings → Items and select the item.
  2. Enter the Standalone Selling Price in the pricing section.
  3. Save the item.
The SSP applies to all future contracts that reference this item. Existing contracts retain the SSP that was in effect when they were activated. If you update an item’s SSP, only contracts activated after the change use the new value - this preserves the historical accuracy of prior allocations.
DualEntry stores the SSP value per item. The estimation methodology - whether you base it on observable standalone sales, an adjusted market assessment, or expected cost plus margin - is yours to determine and document for audit purposes.

​
How allocation works

When you create a contract with multiple obligations, DualEntry allocates the total transaction price proportionally based on each obligation’s SSP. The allocation formula divides each obligation’s SSP by the total SSP, then multiplies by the transaction price: 
Obligation allocated amount = (Obligation SSP / Total SSP) × Total transaction price
Example: A contract has two obligations. Obligation A has an SSP of 60,000andObligationBhasanSSPof60,000 and Obligation B has an SSP of 40,000 - total SSP is $100,000.
  • If the contract’s transaction price is **100,000∗∗:Areceives100,000**: A receives 60,000, B receives $40,000.
  • If the contract’s transaction price is **90,000∗∗:Areceives90,000**: A receives 54,000 (90,000×60/100),Breceives90,000 × 60/100), B receives 36,000 ($90,000 × 40/100).
The allocated amount determines how much revenue DualEntry recognizes for each obligation over its recognition schedule. You can review the allocated amounts on the contract detail view under each obligation’s summary.

​
The residual method

When only one obligation in a contract has an observable SSP, you can use the residual approach to allocate without estimating the unknown price. Assign the known SSP to the observable obligation, and DualEntry allocates the remainder of the transaction price to the other obligation. For example, if the transaction price is 120,000andObligationAhasanSSPof120,000 and Obligation A has an SSP of 80,000, Obligation B receives the residual $40,000. Use this approach when the second obligation’s standalone price is highly variable or not independently observable. The residual method is permitted under ASC 606-10-32-34 when at least one obligation has a directly observable price. Record your rationale for choosing the residual method in your audit documentation.

​
SSP estimation approaches

You configure SSP based on one of three common approaches recognized under ASC 606.
  • Observable standalone sales - the price you charge when selling the item separately to similar customers in similar circumstances. This is the most direct evidence.
  • Adjusted market assessment - an estimate of what customers in the market would pay, adjusted for your entity’s costs and margins. Use this when you do not sell the item separately.
  • Expected cost plus margin - your expected cost to fulfill the obligation, plus a reasonable margin. This approach works when neither standalone sales nor market data are available.
DualEntry does not prescribe which method to use. Record your methodology and supporting analysis outside the system so it is available for auditors. Consistency across similar items strengthens the defensibility of your approach.

​
Reallocation on contract modifications

When a change order modifies the obligations on an active contract, DualEntry reallocates the updated transaction price across all obligations using the same SSP-based formula. The reallocation may result in a cumulative catch-up adjustment to previously recognized revenue. For example, if a 100,000contractisamendedto100,000 contract is amended to 110,000 and a new obligation is added, DualEntry recalculates each obligation’s share based on the updated SSPs and adjusts the recognition schedule. The catch-up adjustment appears as a journal entry in the period the change order is applied. See Change Orders, Terminations, and Renewals for the full modification workflow.

​
Next steps

Last modified on May 28, 2026