Based on the historical-cost principle, under U.S. GAAP, most assets held on the balance sheet are to be recorded at the historical cost even if they have significantly changed in value over time.
For example, say the main headquarters of a company, which includes the land and building, was bought for $100,000 in 1925, and its expected market value today is $20 million. The asset is still recorded on the balance sheet at $100,000.
Not all assets are held at historical cost. For example, marketable securities are held at market value on the balance sheet.
Investment dictionary. Academic. 2012.
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Historical cost — Accountancy Key concepts Accountant · Accounting period · Bookkeeping · Cash and accrual basis · Cash flow management · Chart of accounts … Wikipedia
historical cost — Describes the accounting cost carried in the books for a current cost of the item. Bloomberg Financial Dictionary * * * historical cost historical cost ➔ cost1 * * * The original cost of a company s assets, as distinct from replacement cost. * … Financial and business terms
historical cost — noun 1. : a cost computed after production from records made concurrently with various steps of production contrasted with predetermined cost and standard cost 2. : the value at which a capital asset is recorded on the books representing the… … Useful english dictionary
historical cost — A method of valuing units of stock or other assets based on the original cost incurred by the organization. For example, the issue of stock using first in first out cost or average cost charge the original cost against profits. Similarly, the… … Accounting dictionary
historical cost — įsigijimo savikaina statusas T sritis Gynyba apibrėžtis Išlaidos, kurios turto įsigijimo atveju registruojamos tikrąja įsigijimo verte, o įsipareigojimo atveju – laukiama būsimojo atsiskaitymo verte. atitikmenys: angl. historical cost ryšiai:… … Lithuanian dictionary (lietuvių žodynas)
historical cost — The value of a unit of stock or other asset calculated on the basis of the original cost to the organization of purchasing or manufacturing it, rather than on the basis of its current value to the organization. Compare current cost … Big dictionary of business and management
historical cost — In accounting, acquisition or original cost; e.g. original construction cost of building … Black's law dictionary
historical cost — The unadjusted, original *cost of purchasing an *asset or an item of inventory … Auditor's dictionary
historical cost — Fin the original acquisition cost of an asset, unadjusted for subsequent price level or value changes … The ultimate business dictionary
Historical Cost — historische Anschaffungskosten oder Herstellungskosten, ⇡ Conceptual Framework … Lexikon der Economics