Which of the following costs can increase the cost of a capital asset?

The correct choice highlights that commissions and legal fees incurred during the acquisition of a capital asset are considered part of the total cost of that asset. This treatment aligns with the principle of capitalization, where costs that are necessary to prepare an asset for its intended use are added to the asset's value on the balance sheet.

When a company acquires a capital asset, it must account for all expenditures directly related to purchasing and preparing the asset for service. This can include not only the purchase price but also any legal fees paid to secure ownership and commissions to agents involved in the transaction. By capitalizing these costs, businesses ensure that these expenditures are properly matched with the revenue generated by the asset over time.

While annual maintenance fees are ongoing expenses related to the operation of the asset rather than costs of acquiring it, and depreciation expense represents the allocation of the asset's cost over its useful life, they do not affect the initial cost of the asset itself. Shipping and handling fees, while they can be capitalized in certain scenarios, are generally less emphasized compared to the more significant acquisition-related costs like commissions and legal fees.