Under the acquisition method of accounting for a business combination, restructuring costs are
A) Capitalized and amortized over a period not exceeding ten years.
B) Fees paid to lawyers and accountants to bring about the business combination.
C) Costs incurred to effect the business combination.
D) Treated as post acquisition expenses.

Question

Quizplus · Accepted Answer

Under the acquisition method of accounting for a business combination, restructuring costs are treated as post acquisition expenses. These expenses are not considered part of the cost of acquiring the business and are therefore expensed as incurred.

Under the Acquisition Method of Accounting for a Business Combination