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

40 VALUATION, DEPRECIATION AND THE RATE-BASE struction. The actual cost, intelligent direction and super- vision being assumed, is generally a better guide to the cost of accomplishing a result, than the estimate of the expert who, no matter how much he knows about present cost, must make certain assumptions relating to the past or the future which will always brand his conclusions as approximations, even though the approximations are in some cases to be accepted as being quite as dependable and as acceptable as though they were of absolute accuracy. It is not proposed to introduce into this volume sample sheets enumerating all the various items that may be encountered in valuing the various classes of public utilities and industrial establishments. The blanks in use for these purposes are ob- tainable, at least for the utilities, from any of the public service commissions and will be found an excellent guide in listing and appraising the physical elements of value. The Relation of Present Worth to the Cost of Replacement. — After the cost of reproduction has been determined the time must be estimated during which — everything considered — the article to be valued may reasonably be assumed to continue in service. With this time and the probable life new of articles of the same class it will, as elsewhere explained, be possible to estimate the relation which the present worth of the article bears to the cost of replacing it at the time it will probably be discarded. If now the cost of reproduction be so modified that it will represent the cost of replacing the article at the end of its period of usefulness and the present worth or condition factor is applied to this cost of replacement the result will be the present worth. When the property to be valued includes land, rights-of-way or water-rights, regard should be had to the principles dis- cussed in the chapters on the “ Valuation of Land in Eminent Domain Proceedings ” and the “ Value of a Water-Right and of Reservoir Lands.” Extent of Detail Required. — It has become a common prac- tice in valuing property for rate-fixing purposes to approximate

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