Deloitte
Accounting Research Tool
...
Chapter 7 — Certain Option Combinations

7.2 Illustrations of the Application of ASC 480-10 to Certain Option Combinations

7.2 Illustrations of the Application of ASC 480-10 to Certain Option Combinations

The application of the scope provisions and the accounting requirements in ASC 480-10 depends on how an issuer’s contractual rights and obligations are aggregated or disaggregated into units of account (see Section 3.3). The guidance in ASC 480-10-55-19 and 55-20 and in ASC 480-10-55-34 through 55-37 illustrates the application of ASC 480-10 to sets of options that involve the same counterparty and are executed contemporaneously. Each freestanding financial instrument is assessed separately under ASC 480-10, whereas a freestanding financial instrument that includes multiple components is analyzed in its entirety.