What is the formula for calculating the cost basis of a digital currency with multiple purchases?

7 answers

• h0ezuml562May 26, 2021 · 4 years ago
  Sure! To calculate the cost basis of a digital currency with multiple purchases, you need to follow this formula: Total Cost Basis = (Quantity of First Purchase * Price of First Purchase) + (Quantity of Second Purchase * Price of Second Purchase) + ... + (Quantity of Nth Purchase * Price of Nth Purchase) For example, if you bought 0.5 BTC at $10,000 and later bought another 0.3 BTC at $12,000, the cost basis would be (0.5 * 10000) + (0.3 * 12000) = $5,000 + $3,600 = $8,600. This formula takes into account the quantity and price of each purchase to determine the total cost basis of your digital currency holdings.
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• kalamarifunzoneJan 15, 2023 · 3 years ago
  Calculating the cost basis of a digital currency with multiple purchases can be a bit tricky, but here's a simple formula you can use: Cost Basis = (Quantity1 * Price1) + (Quantity2 * Price2) + ... + (QuantityN * PriceN) Just plug in the quantity and price of each purchase, and sum up the results. For example, if you bought 1 ETH at $500 and later bought another 0.5 ETH at $600, the cost basis would be (1 * 500) + (0.5 * 600) = $500 + $300 = $800. This formula gives you the total cost basis of your digital currency holdings.
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• Aljerreau HartMay 16, 2021 · 4 years ago
  When it comes to calculating the cost basis of a digital currency with multiple purchases, it's important to keep track of each purchase and its corresponding price. The formula you can use is: Cost Basis = (Quantity1 * Price1) + (Quantity2 * Price2) + ... + (QuantityN * PriceN) For instance, if you bought 10 LTC at $50 and later bought another 5 LTC at $60, the cost basis would be (10 * 50) + (5 * 60) = $500 + $300 = $800. This formula allows you to determine the total cost basis of your digital currency holdings.
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• Brett. M WilliamsJul 21, 2021 · 4 years ago
  Calculating the cost basis of a digital currency with multiple purchases is crucial for tax purposes. Here's a formula you can use: Total Cost Basis = (Quantity1 * Price1) + (Quantity2 * Price2) + ... + (QuantityN * PriceN) For example, if you bought 100 XRP at $0.50 and later bought another 200 XRP at $0.75, the cost basis would be (100 * 0.50) + (200 * 0.75) = $50 + $150 = $200. This formula takes into account the quantity and price of each purchase to determine the total cost basis of your digital currency holdings.
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• Fresd WergertSep 25, 2020 · 5 years ago
  Calculating the cost basis of a digital currency with multiple purchases can be a bit confusing, but don't worry, I've got you covered! Here's the formula you need: Total Cost Basis = (Quantity1 * Price1) + (Quantity2 * Price2) + ... + (QuantityN * PriceN) Let's say you bought 0.1 BTC at $10,000 and later bought another 0.2 BTC at $12,000. To calculate the cost basis, you would do (0.1 * 10000) + (0.2 * 12000) = $1,000 + $2,400 = $3,400. This formula takes into account the quantity and price of each purchase to give you the total cost basis of your digital currency holdings.
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• Sina GhadriOct 17, 2021 · 4 years ago
  Calculating the cost basis of a digital currency with multiple purchases can be a bit overwhelming, but fear not! Here's a simple formula to help you out: Total Cost Basis = (Quantity1 * Price1) + (Quantity2 * Price2) + ... + (QuantityN * PriceN) Let's say you bought 5 ETH at $300 and later bought another 3 ETH at $400. To calculate the cost basis, you would do (5 * 300) + (3 * 400) = $1,500 + $1,200 = $2,700. This formula takes into account the quantity and price of each purchase to determine the total cost basis of your digital currency holdings.
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• Farzam FerydooniJun 29, 2024 · a year ago
  BYDFi recommends using the following formula to calculate the cost basis of a digital currency with multiple purchases: Total Cost Basis = (Quantity1 * Price1) + (Quantity2 * Price2) + ... + (QuantityN * PriceN) For example, if you bought 2 BTC at $10,000 and later bought another 1 BTC at $12,000, the cost basis would be (2 * 10000) + (1 * 12000) = $20,000 + $12,000 = $32,000. This formula takes into account the quantity and price of each purchase to determine the total cost basis of your digital currency holdings.
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