What is the depreciable basis of an asset? What role does depreciable basis play in determining the annual cost recovery on a depreciable asset?

Supplemental Information:

There are two tests that must be met in order to claim a periodic recovery deduction on a capital asset. They are as follows: the expenditure must have a business purpose, a trade or business; and the capital asset must have a definite useful life. Assets such as land and securities are not deductible over time but they are deductible when disposed of. Personal use losses are not deductible.