Firms must expense when incurred the transactions cost of acquiring a firm in a business combination under both U.S.GAAP and IFRS.

Question

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Both U.S.GAAP and IFRS require firms to expense the transactions cost of acquiring a firm in a business combination as incurred. These costs, such as legal and accounting fees, are considered part of the cost of the acquisition and are included in the overall purchase price of the acquired business.

Firms Must Expense When Incurred the Transactions Cost of Acquiring