Acquisition cost is a term commonly used in business and finance to describe the total cost incurred in acquiring a particular asset or resource. It is an important metric that helps businesses assess the financial impact of acquiring new assets or resources.
Definitions
Acquisition cost can be defined as the total cost incurred in acquiring a particular asset, including the purchase price, taxes, and other associated costs. It can also refer to the cost of acquiring a customer or client, including marketing and advertising expenses.
Origin
The term acquisition cost has been in use since the early 20th century, and its origins can be traced back to the field of accounting. It was initially used to describe the cost of acquiring tangible assets such as property, plant, and equipment.
Meaning in different dictionaries
According to the Oxford English Dictionary, acquisition cost is defined as “the total cost incurred in acquiring an asset, including any associated costs such as taxes or fees.” Merriam-Webster defines it as “the total cost incurred in acquiring something.”
Associations
Acquisition cost is often associated with the purchase of capital assets such as machinery, equipment, and property. It is also used in the context of customer acquisition, where it refers to the cost of acquiring new customers or clients.
Synonyms
Some synonyms of acquisition cost include purchase cost, procurement cost, and acquisition price.
Antonyms
There are no direct antonyms of acquisition cost, but some related terms include disposal cost, divestiture cost, and liquidation cost.
The same root words
The word acquisition comes from the Latin word acquisitio, which means “acquisition” or “gain.” The root word is acquirere, which means “to acquire” or “to gain.”
Example Sentences
- The acquisition cost of the new machinery was much higher than expected.
- The company’s acquisition cost for new customers has been steadily increasing.
- The acquisition cost of the property included not only the purchase price but also legal fees and taxes.