Acquisition accounting only applies to the acquisition of a business. ASC Topic 805 identifies an initial condition that immediately determines that the transaction is not an acquisition of a business, without further analysis. What is this condition?

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ASC Topic 805 specifies that the acquisition of a single identifiable asset does not constitute the acquisition of a business, as it does not meet the definition of a business under the accounting standards, which typically requires an integrated set of activities and assets.

Acquisition Accounting Only Applies to the Acquisition of a Business