Asset Accounting (FI-AA)

The upper limit for valuation of an asset in the balance sheet.

For external acquisitions, acquisition costs include all expenses for the acquisition including incidental acquisition costs, minus reductions to the purchase price.

Incidental costs include:

• Freight charges
• Forwarding costs
• Commissions
• Costs for building a foundation, and so on

Reductions in purchase price can be:

• Rebates
• Cash discounts
• Bonuses
• Price reductions because of defects
• Subsidies granted by a third party, and so on

For in-house acquisitions, production costs include:

• Direct and indirect costs, including materials handling overhead
• Direct labor costs, including payroll overhead
• Special production costs
• Fair administrative expense (can be included)