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Definitions from the Web

Cost-Basis

Description:

Cost-basis refers to the original value of an asset, typically for tax or accounting purposes. It represents the amount of money invested in acquiring an asset, which may include the purchase price and additional expenses such as commissions or fees.

Senses:

Sense 1: Financial Accounting

In financial accounting, cost-basis is the original monetary value assigned to an asset for recording purposes.

Example sentence: The company reported the cost-basis of its fixed assets as $1 million in its annual financial statement.

Sense 2: Taxation

In taxation, cost-basis is used to determine capital gains or losses when an asset is sold or disposed of.

Example sentence: She calculated her capital gain by subtracting the cost-basis of the sold shares from the selling price.

Usage:

Usage 1: Investment Planning

Understanding the cost-basis of investments is crucial for determining taxable gains or losses and making informed decisions about portfolio management.

Example sentence: The financial advisor discussed the importance of keeping track of cost-basis information for effective investment planning.

Usage 2: Real Estate

Real estate transactions often involve complex cost-basis calculations considering the purchase price, closing costs, and improvements made to the property.

Example sentence: The real estate agent advised the sellers to maintain detailed records of their property's cost-basis to accurately determine their taxable profit.

Possible Related Products:

Investment Accounting Software

Tax Planning Books