22 VALUATION, DEPRECIATION AND THE RATE-BASE 
dents of the early years of its life and by careful attention and 
replacements of its wearing parts is still rendering first-class 
service. The value of this pump is not to be written off the 
books, neither should it be regarded as good as new. Its value 
is ascertained by determining its probable additional years of use- 
fulness and the probable cost of replacing it at the end of this term. 
An irrigation canal usually improves with age. So far as 
wear and tear is concerned, it has unlimited life. But under 
the development of extensive areas, the small original canal may 
in the course of time be superseded. The probable life of this 
canal, and therefore, too, the annual replacement increment, is 
estimated on some assumption relating to the rate of this develop- 
ment. Finally the time comes when the project for a compre- 
hensive canal system has taken shape and it may reasonably be 
assumed that within a definite period, five or ten, or some other 
number of years, the original canal will be superseded; its di- 
verting dam and its headworks, and perhaps the canal itself, will 
then be abandoned. The remaining life or expectancy of the 
canal is at that time only five or ten or some other number of 
years, as the case may be, and within this time the remaining 
investment in the canal is the amount under consideration for 
replacement. 
Composite Life. — The composite life of a complex plant is 
that term of years within which the accruing depreciation of all 
items of which the plant is composed, on the assumption of no 
replacements, would amount to the cost of the plant. As in 
the case of articles in classes according to their probable life, so 
in the case of entire plants, the life thus determined for various 
types of plants is made an aid in estimating the current de- 
preciation. Without recourse to the more laborious method of 
dealing separately with each item of which the plant is made up, 
it becomes possible if composite life is known to approximate 
the current depreciation or replacement requirement. 
Composite Age. — The composite age of a complex plant is 
that age which it would have to acquire, if treated as a depre- 
cating unit, to make its accrued depreciation equal to the