How should the transaction costs of issuing shares in acquisition be recognized?
A)Deducted from shareholders' equity, net of related income tax benefits.
B)Expensed.
C)Capitalized as part of the cost of the shares.
D)Deducted in total from shareholders' equity.

Question

Quizplus · Accepted Answer

Transaction costs of issuing shares in an acquisition should be deducted from shareholders' equity, net of related income tax benefits, as they are considered a cost of raising capital.

How Should the Transaction Costs of Issuing Shares in Acquisition