The adjusted basis of an asset is:
A)The cost of the asset.
B)The cost basis less any accumulated depreciation.
C)The trade-in value of the asset.
D)The fair market value of the asset.

Question

Quizplus · Accepted Answer

The adjusted basis of an asset is the cost basis (purchase price) less any accumulated depreciation. This reflects the true value of the asset after taking into account wear and tear or obsolescence. The trade-in value or fair market value may be relevant for determining the selling price or potential gain/loss, but they do not factor into the adjusted basis.

The Adjusted Basis of an Asset Is