Adjusted Basis
Tax or accounting basis after increases, decreases, depreciation, or improvements, used to calculate gain, loss, and deductions.
Accounting terms for adjusted basis, cash basis, fair value, FVPL, historical cost, and revaluation methods.
Basis, Fair Value, and Measurement Attributes covers adjusted basis, cash basis, fair value, FVPL, historical cost, and revaluation methods.
Use these pages when accounting mechanics change how a transaction becomes a reported asset, liability, income item, expense, equity item, or cash-flow classification. It sits inside Recognition, Measurement, and Qualitative Characteristics, so readers can move up when the broader accounting context matters.
Use the table below to choose the narrower accounting branch before applying a term to a statement line, model input, audit trail, tax schedule, covenant test, or management report.
| Area | Use it for |
|---|---|
| Adjusted Basis | Tax or accounting basis after increases, decreases, depreciation, or improvements, used to calculate gain, loss, and deductions. |
| Basis | Basis refers to the amount representing the taxpayer’s cost in acquiring an asset, used for computing gain or loss on sale, exchange, and depreciation purposes. |
| Cash Basis | Accounting basis that records income and expenses when cash is received or paid, rather than when obligations are earned or incurred. |
| Fair Value | Measurement estimate of an asset or liability’s market-based value, central to reporting, valuation, and disclosure. |
| Fair Value Through Profit or Loss (FVPL) | Fair value through profit or loss reports qualifying assets or liabilities at fair value with changes recognized in earnings. |
| Historical Cost Principle | The Historical Cost Principle dictates that assets are recorded at their original purchase cost, ensuring objectivity and reliability in financial statements. |
| Revaluation Method | The revaluation method reports certain assets at updated fair values rather than historical cost, subject to accounting rules. |
Accounting-foundation content is educational and does not provide bookkeeping, accounting, tax, audit, legal, investment, or valuation advice.
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Tax or accounting basis after increases, decreases, depreciation, or improvements, used to calculate gain, loss, and deductions.
Basis refers to the amount representing the taxpayer's cost in acquiring an asset, used for computing gain or loss on sale, exchange, and depreciation purposes.
The cash basis, or cash method, is an accounting approach used by most individual taxpayers that recognizes income and deductions when money is received or paid.
Measurement estimate of an asset or liability's market-based value, central to reporting, valuation, and disclosure.
Fair value through profit or loss reports qualifying assets or liabilities at fair value with changes recognized in earnings.
The Historical Cost Principle dictates that assets are recorded at their original purchase cost, ensuring objectivity and reliability in financial statements.
The revaluation method reports certain assets at updated fair values rather than historical cost, subject to accounting rules.