Valuation, depreciation and the rate base

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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.

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter XII. The accounting system

Collection:: Economics Books

236 VALUATION, DEPRECIATION AND THE RATE-BASE commodity or of a service is to be ascertained and its sale price is to be fixed. The cost records should be so kept that they will give all needed information relating to past financial history as well as to the current cost of operation. Any reduction in the value of an operative property such as may result from an advance in the art of the manufacture of its output or due to decrease in value of real estate and like causes, may result in an operating loss. In the case of a public service corporation where the investment is of real concern, such possible reduction of value is one of the elements covered by the hazards of the business and should be forestalled or should in the course of time be amortized by the excess of earnings over and above earnings on ordinary safe investments. Any increase in value, no matter what it may result from, belongs among the earnings. Despite the rulings which have been had on this point by competent authority, it would seem preferable not to include appreciation in the rate-base but as elsewhere suggested to permit earnings that will give the owner a limited share in the general prosperity of the community.

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