Cost Basis Methods are the methods used in accounting to determine the total cost of an asset. This includes both the purchase price and any associated costs, such as installation fees or transportation costs. Cost Basis Methods allow businesses to accurately track their assets’ initial investments and to determine their current market values. It also helps businesses decide when and how to depreciate an asset, allowing them to maximize deductions and minimize taxes. Understanding your business’s cost basis methods is a key part of ensuring that you are making sound financial decisions.