Technical definition
The amount at which an asset or liability is reported after relevant allocations and adjustments.
How it works
For depreciable equipment, carrying amount commonly equals historical cost less accumulated depreciation and impairment. Different assets and liabilities use different measurement rules.
Everyday example
Equipment cost 50,000 less accumulated depreciation 20,000 gives a carrying amount of $30,000.
Common pitfall
Book value is not automatically fair value, resale value or replacement cost.