Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1904-05-02
. Goinn Concern Value.

Test.sEirst, the appraisers are to de-
term;neathe efficiency Of the system.
The assumption that the lawful net IN
come for the current yea" was Slo,-
NiSH:. was based upon the assumption
that the water was pure. On the law
ful basis OF pure water, charging d
revenue that would entlile the taker
10 drlw ut his faucet water not infected
With diScd;c, this company has laWiIl
right to collect a net income OF Slo,-
.lG.29. Every takcr paid for pure wa
ter on the basis of pure water prices
This plant is furnishing water danger
uuSly impure and for this reason UNI
dIinknhlc. Second, to determine tns
length Of time ncccssaryStos construct
the SINE plant de novo. All the en-
rinocrs agrc" it will take yo:lr
Third to determine the time and cos.
needed after ronstructionSto develop
such mex system to the tfevel of thu
present one i'll respect to business and
income
The most important inquiry is the
time it would take IA new plant. if con-
stTurtcn began on March LIST. 1904. and
vas completed on March Isl. 1905. TO
acquire IN .I,inual net inCon" equal to
IN" lawful net income Of I'll" present
llaut. Tho answer calls for careful
Judgment. but can only y" approx
mr'cly r"a"n"l ny pro- CT differences
,ruIa IL" evidence. The first year the
purchaser would lose the "!itirc net in
,"r" tluimiy churgcahlc ON March LIST.
'oi. hy the cid p!rnt. The loss so ac-
- l.
NiNAa. He would be building his new
ilnt. Here oC course the prices of
l'Ni would prevail and the cost would
hr S2"N.ItSa2. To be fair the per
cent. Life should he usel. The inter-
'st would ~" equal to SG.4GS.10. Total
les $'l%l2.5j. The present worth is
IN" real loss u; Of March /. 1904. Dis
counted at : per cent. present value of
NE loss is Sl6.i$S 10. Fair study of The
"Nil'nt" shows that during the first
year The new plan; will take on at least
"n"-haf Of the present business Of the
cid plant. The third year the new
plant ought to t1lr on business equal
TO three fou,ths of the maximum gross
income of the plant. Tho next year tho
plan; ought to reach the level of the
present one in respect to business and
income. Gross loss s33. O5G 10 discounted
20 March LIST. 1904. net loss. S3O,590. s..
or. II use the language of the court,
SSH.3ee represents, assuming tho time
~ be fuur years. the cost needed to de-
velop such new system to the level If
the present on" in respect to business
and income. We CorStruc the word !,
business and income to mean lawful
business and lawful income Before
computing this result :here must be
certain deductions. First, the efficiency
"i tAe system. Tie necessity for The
lnriiicati"n of the water is admitted.
iE:lh'at;on is POSSIBLE only by going TO
H'h5cr pond or by filtration. A pipe
n'e TO Wobber pond would cost
IH'''EF. Filtration, Fuller Hazen.
i'e!!Mg md Gray the district engineers
eSumat" would cost s10o.534. To pre-
r.e II" pure water valuation of
-f'"''>S the company should have
'I'Eea owe: to US a filter plant and pipe
yes necessary for new plant tina t
|'lI have cost S10o,534 The plant
'NS mat amount to make it efficient.
~ ! worth net 10 us for pure water
n" n"<"S, Si47.o35.SS. This plant is
'''"Iieht 10 the extent Of $10O,534 and