Final answer:
The main accounting issue for software vendors who bundle their products is revenue recognition, as it can be complex to allocate the total price to each component in the bundle. Bundling can also be seen as anticompetitive in certain contexts, adding legal considerations to the practice. The price of bundling is generally appealing for consumers as it often provides a perceived extra value.
Step-by-step explanation:
The critical accounting issue regarding software vendors who bundle their products for a lump-sum contract price primarily concerns revenue recognition. Software vendors may offer multiple programs as part of a single bundle, although consumers might not require all the included software. This practice raises questions about how to allocate the total price to each software component, especially for accounting purposes. Moreover, some bundling can be perceived as anticompetitive, which could also have legal implications.
For instance, offering a software package with a new computer might make the price of bundling more appealing to consumers, who perceive additional value in acquiring multiple products together at a discounted rate. However, this strategy can become complex when considering how to record revenues for each element of the bundle. It is essential for software vendors to follow applicable accounting standards to ensure proper revenue allocation and compliance with regulations.