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upr000063 63

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upr000063-063
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    ? of way at $8,000.00. o. estimating operating expenses of the Water Com­pany in accordance with latest experience shown in the record. d. computing retirement reserve deductions, depre­ciation and federal income taxes correctly. When such rate bases are used and a 6-1/4$ return is allowed to each, the Railroad Company and the Water Company, the deficiency in revenue in the test year 1951 under the for­mer rates is found to be #97,024.00 instead of #25,112.00 or an error of #71,912.00 (Schedule IV p. 2). When the same rate bases and method are used, and a 6$ return is allowed to each, the Railroad Company and the Water Company, the defic­iency in revenues in the test year 1951 under the former, rates is found to be #93,657.00 instead of #25,112.00, or an error of #68,545.00. (Schedule V, p. 2). If the average rate bases and methods above men­tioned are used, but there is excluded from the Railroad Com­pany rate base all land, except 240 acres and rights of way, and each company is allowed a return of 6$ upon its base, the deficiency in revenue under the former rates is found to be #88,705.00 instead of #25,112.00 as found by the Commission, or an error of #63,593.00 (Sohedulo VI). This §88,705.00 is approximately the deficiency in revenues under the former rates that the rates proposed by the Water Company would have remedied (Ex. A shows added revenue under proposed rates to - 1 3 -