Valuation, depreciation and the rate base

Bibliographic data

Monograph

Identifikator:: 174667931X

URN:: urn:nbn:de:zbw-retromon-119897

Document type:: Monograph

Author:: Grunsky, Carl Ewald http://d-nb.info/gnd/10180959X

Title:: Valuation, depreciation and the rate base

Edition:: 2. ed., revised and extended

Place of publication:: New York

Publisher:: Wiley

Year of publication:: 1927

Scope:: X, 500 Seiten

Digitisation:: 2021

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Chapter IV. Essentials of value

Collection:: Economics Books

52 VALUATION, DEPRECIATION AND THE RATE-BASE Am. Soc. C. E. Committee, Interest and Taxes. — Referring to interest and taxes the Committee says: “ Interest upon the capital invested in the plant up to the time when it is first operated and begins to have earning capacity is an unavoidable expense. “ Under the most favorable conditions it is necessary to raise the money required for the construction of the work months in advance of its expenditure and in many cases the whole amount must be raised before beginning the work in order to insure against a suspension of operations with the large loss neces- sarily incident thereto. “ The rate allowed for interest during the construction should be the prevailing rate at the time of the valuation, having re- gard, however, to the variations in rate in different localities and the character of the property. The rate of interest on money required for the original plant will generally be larger than on that required for extensions and betterments as the corporation naturally has a stronger financial standing after it possesses a successful operating plant. “ The amount to be allowed for taxes during construction must be determined largely on the basis of local tax rates and other local conditions and in this case, as in others relating to over- head charges, the original plant and subsequent additions should be treated separately.” Overhead in Railroad Construction. — While as in the case of other items of cost the records of expenditures may be the best guide when overhead charges of an operating property are to be determined, they are not always to be accepted without ques- tion; the appraiser must know whether they are reasonable or not. It is for this reason that such data as above presented are of interest to the appraiser. Following this matter further it may be noted that in valuing the railroads of the State of Wash- ington Mr. H. P. Gillette ascertained from their records of cost that their overhead costs were as shown in the following table:

Access restriction

Copyright

fullscreen: Valuation, depreciation and the rate base

Monograph

Chapter

Table of contents

Download

Monograph

Chapter

This page

Image fragment

Citation links

Citation recommendation