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X i.e., no amount can be charged to the retirement reserve account for book value on plant property withdrawn during the year oniwhich very little depreciation, if any,-had previously been set up on the company*s books and credited to the retirement reserve account. V The rate of return, as corrected, is 6,44$ in 1944; 9.30$ in 1945; 3.77$ in 1946 and 7.47$ for the year 1947. At the end of the year 1947 the compamy was furnishing water to 745 customers who consumed an average 36,000 cubic feet of water for the year. During the year 1946, the company proposes to make additions to Its present water system in the amount of #21,950.00, Property to be retired will amount to approximately #5*600,00 or a net increase to the capital investment account of #16,350.00. CONCLUSIONS The points to be determined in this proceeding are: the rate of return to the company on the value of the property devoted to the public in rendering utility service, and the reasonableness of the rates charged for said service. The electric plant was purchased on July 31> 1944* at a cost of #194 ,649.15. Additions and betterments made since date of acquisition until December 31, 1947» amounted to #156,672.65. Property withdrawn from service during the same period totalled #33>492.56, leaving a net cost of plant of #3l6,029»44. After deducting the total accrued depreciation amounting to #39*926.19* the net value of the electric plant is #276,103.25. By adding to the latter amount the sums of #15,672.66 for materials and supplies and #6,976.92 for working capital, we obtain a total of #302,954.63 as the net, rate base for rate-making purposes. The utility received a rate of return on its net rate base of 7.66$ in 1945; 9.16$ in 1946 and 7.73$ in 1947. | I The company propees to spend #26,315.00 for new extensions and betterments during the year 1946, Construction of a line into Paradise Valley is to commence in 1949, the total cost of which is estimated at #150,000,00, Taking into consideration these additions to the capital account, the company will realize a rate of retorn of approximately IS 6.16$, -6- ?PP-fe; / l | /f| ‘ v.