64 VALUATION, DEPRECIATION AND THE RATE-BASE 
water system is a going concern, with a profitable business 
established, and with a present income assured and now being 
earned.” 
“ Going Value ” and ‘ the Going Concern.” — A distinction 
is to be made between the ‘ value of the going concern” and 
“ going value.” The value of the going concern is the total 
value of the entire property, its market value. “ Going value ” 
is the increment of value due to the fact that the business is 
established and in successful operation. It should be at least 
equal to the reasonable cost of establishing the business, includ- 
ing a reasonable allowance for losses in early, lean business years. 
If assured earnings are large when compared with the operating 
cost it may greatly exceed early losses just as value may exceed 
cost. In the case of unprofitable business, as when a company’s 
properties are in a receiver’s hand, going value will be only 
nominal. 
It sometimes happens that the public is responsible in some 
measure for inadequate earnings as in the case of competing 
utilities. By permitting the competition and a duplication of 
works, the cost of bringing the business up to a profitable basis 
is increased and may be the cause of increased losses. 
Going Value in the Decisions of the Wisconsin R. R. Com- 
mission. — On the subject of ““ going value ”’ the Wisconsin Rail- 
road Commission in the Cashton Light and Power Co. case 
(Wis. R. C. R., Vol. 3, p. 85) declares this to be an element of 
value which must be taken into account. The Commission after 
stating that it is akin to “ good-will ” refers to Justice Brewer's 
views in National Waterworks Co. vs. Kansas City (62 Fed. Rep. 
853) and then cites the opinion in Cedar Rapids Water Co. vs. 
Cedar Rapids (118 Towa, 234) to the effect that “ going value ” is 
“that value which arises from having an established going busi- 
ness . . . and attaches to the business rather than the property 
employed in such business.” 
The Commission takes a sound view when it says in the Antigo 
Water Co. case (Wis. R. C. R., Vol. 3, p. 707) that the ques- 
tion as to whether deficits resulting from operation, or due to