Which cost is not included in the initial measurement of intangibles?

The correct answer identifies advertising costs incurred before acquiring an intangible asset as not being included in the initial measurement of intangibles. When determining the initial cost of an intangible asset under accounting standards, only costs that are directly attributable to the acquisition of that asset are considered. This means that expenses such as employee labor directly linked to the development or acquisition of the asset, as well as legal fees associated with its acquisition, are included, as they are necessary to bring the asset to its intended use and condition.

Additionally, testing costs that evaluate the performance of the asset before it is put into service also fall under costs that can be capitalized if they are directly related to the intangible asset's development or enhancement. However, advertising costs typically do not meet this criterion. These costs are more related to marketing and generating future revenue rather than to the acquisition of the asset itself. Therefore, they are treated as expenses in the period in which they are incurred and are not capitalized as part of the asset's initial measurement.