Question

Innove Tech is a technological firm that wants to build a global service delivery system. It has consulted a larger firm, Ziff Corp., to obtain the proven technology required to establish this system. In the context of the costs of useful information, Innove Tech has incurred _____.

Answer 1

Answer:

Acquisition cost.

Explanation:

When Innove Tech is obtaining the technology from Ziff Corp.they are incurring acquisition cost.

Acquisition cost is the cost incurred for obtaining a property or asset including shipping, installation, taxes, customer fees, and testing.

The total cost of acquisition is what will be recorded as the book value.

For example if a software is purchased for $200,000. Installation and training cost is $30,000, the book value recorded for the software will be $230,000.

Answer 2

Answer:

The correct answer is: Acquisition Cost.

Explanation:

A business should consider the acquisition costs as those used to purchase any kind of equipment or property. Costs are calculated for discounts, bonuses, closing costs and other expenditures included in this context. Costs of acquisitions do not include sales tax.