How Should Legal Fees for an Acquisition Be Treated

question 2

Multiple Choice

How should legal fees for an acquisition be treated?

• A)Capitalized as part of the acquisition cost.
• B)Expensed in the period of acquisition.
• C)Deferred and amortized.
• D)Deferred until the company is disposed of or wound-up.

---

Definitions:

Oxygen

Oxygen, a diatomic gas with the molecular formula O2, is critical for respiration in living organisms and supports combustion.

Ionic Compound

A chemical compound formed by the transfer of electrons from one atom to another, resulting in the formation of positively and negatively charged ions.

Aluminum

Aluminum is a lightweight, silver-white metallic element (Al) used extensively in alloys and for its properties of corrosion resistance and high conductivity.

Chlorine

A highly reactive, greenish-yellow gaseous halogen with the symbol Cl and atomic number 17, widely used in water treatment, bleaches, and industrial processes.