Document refers to the single web page you are placing the canonical link on.
The base link is referring to the URL you can provide as the href property for the base tag. The base tag can be included in the head of your HTML document.
Example base link:
<base href="http://www.ccisolutions.com/">
If you choose to use the example base link above and this relative URL:
Your canonical link will end up referring to “http://www.ccisolutions.com/page1.html”.
Here is a second example, this time using a new base link which includes the products directory:
<base href="http://www.ccisolutions.com/products/">
If you choose to use this new base link and the following relative URL:
Your canonical link will end up referring to “http://www.ccisolutions.com/products/page1.html”.
If you choose to use this new base link and this relative URL:
Your canonical link will actually refer to one-level-up from your base link or “http://www.ccisolutions.com/page1.html”. I'm not sure if you're familiar with the syntax "../" (dot dot slash), but it means to go up one level from the current directory.
The use of base links for canonical linking might be useful for a CMS where the content is generally dynamically created. It might be good to sit down with your developers and discuss which tactic would be best for the site in question.
I am including a link to this SEOmoz blog post in case it is also of help.
Edit: expanded on the explanations...