Logik des Geldes

Valuation, depreciation and the rate base

Bibliographic data

Monograph

Identifikator:: 890261784

URN:: urn:nbn:de:zbw-retromon-15521

Document type:: Monograph

Author:: Moll, Bruno http://d-nb.info/gnd/117121045

Title:: Logik des Geldes

Place of publication:: München

Publisher:: Verlag von Duncker & Humblot

Year of publication:: 1916

Scope:: 1 Online-Ressource (104 Seiten)

Digitisation:: 2017

Collection:: Economics Books

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

126 VALUATION, DEPRECIATION AND THE RATE-BASE compensation which the owner may expect for establishing and managing the utility and also as to whether, in every case, the value of the service rendered has really justified the enterprise. There is much uncertainty, in other words, in relation to the earnings in excess of interest on the investment that will be permitted by the public service commissions, and, when value depends largely upon prospective business, there may be uncer- tainty, too, relating to the forecast of earnings on which the estimates of profits are based. Fifth Step — Determination of Profits. — The fifth step in- volves a comparison of the cost of operation with the antici- pated gross income. The excess of the income over cost of operation represents the profits of the business. The profits may be actual or they may be prospective. The profits both current and prospective in excess of interest on the investment, when capitalized, create an increment of value in excess of the investment. This increment of value may, according to circumstances, be apportioned to “franchise,” ‘going value,” ““ good-will,” “ patent right,” or any other classification of value that may seem appropriate. Real Estate Value. — The valuation of real estate may acquire special consideration. But here, as in the case of other revenue- producing property, the real test of value is the amount of the revenue which the property will produce. What is the rental value of the property? This is the question to be answered. The appraiser will direct his inquiry to the gross income, imme- diate or prospective, which is dependable. He will ascertain the taxes and probable assessments for improvements to which the property is liable, and he will determine from these various items the net revenue which the property will produce. This net revenue, immediate and prospective including appreciation, will then determine the value. When the right of eminent domain is exercised to acquire real estate for some special purpose due consideration must be given to its serviceability for the intended use. This subject is further considered in Chapter X.

Access restriction

Copyright

fullscreen: Valuation, depreciation and the rate base

Monograph

Table of contents

Download

Monograph

Chapter

This page

Image fragment

Citation links

Citation recommendation