00:01
Okay, so we need to explain how to determine or how the cost basis of depreciable property is determined.
00:09
Okay, there's many bases, but if we're going to be focusing on the cost basis here in particular, we have to understand that it's basically all the costs involved to bring that asset into its use, all right? so if it's going to be used in order for business to generate income, so everything that is going to be involved, all the costs involved, to ensure that that asset is functional to do what has been purchased to do, which is to generate income.
00:44
Then that's the cost basis of basically making sure that all the costs from the purchase, freight, and all for installation.
01:00
Are accounted for in order to get the machine or the property to work.
01:06
So the original cost of the property is going to be involved and excluding any form of discount because obviously it's going to reduce the value of the, i mean, the value of that property is, if i may say...