How do you identify items?

[Mal Malenkirk]

I have the skill at 1 rank which I'm guessing is not enough for thre three items to identify I found so far. Surely there is a vendor somewhere that can identify them for a fee? Can't find any.

[Kordanor]

You can go just to the vendor in the starting village. There is an icon to identify stuff. Though it doesn't seem to show the price for that (or I didn't see it).

[Big Daddy B]

The merchants in town, the third option in the middle. Stop ranking Item Identification, not really worth the points.

[MeniDanger]

The skill identifies items as soon as they enter your inventory (if high enough). When you identify at the vendor, iirc it shows the price of identification when you hover over the button a bit. It can get quite pricey for high grade stuff, though that is only a prob in the beginning.
I leveled the skill on my bard for roleplaying's sake and cause it was only 1 point cost.