How are direct and indirect costs accounted for when applying the acquisition method for a business combination?

Question

Quizplus · Accepted Answer

Under the acquisition method for a business combination, both direct and indirect costs are included in the cost of acquisition. Option A states that only direct costs are accounted for, which is incorrect. Option B correctly states that both direct and indirect costs are accounted for. Option C, D, and E are irrelevant as they do not provide any information regarding the accounting treatment of direct and indirect costs under the acquisition method.

How Are Direct and Indirect Costs Accounted for When Applying