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29 3. Fixed Capital and Rate Base Fixed C ap ital Fixed capital in service may be classified as both tangible and intangible which is represented by plant facilities and water rights that are used and useful in rendering service to the water consumers of the has Vegas hand and Water Company* the capital thus employed is first classified as between the two systems» namely, A - The Water Production Facilities (Los Angeles k Salt hake Railroad Co.) B « The Water Utility (has Vegas hand and Water Company). Each of these capital groups is in turn set up under three primary capital bases, which are: 1 - Investment Cost* - the recorded costs as set up on the books of the two companies* II - Original Cost - the investment cost as adjusted for: (a) hand with adjusted acreage at present day costs* (b) Increase in investment costs resulting from increase in capital costs on replacements of like plant units (mains), which amounts were not capitalised on the books under betterment accounting*— ^ (c) Acquisition adjustments - difference between recorded costs (investment costs) and costs to the original owner of the acquired properties. —i^oth companies follow the accounting procedure.prescribed by the Interstate Commerce Commission, wherein only the betterment in the replacement of a retired plant unit is capitalized. Under the I.C.C. system of accounting, the definition and treatment of betterments is covered by 'the following statement: "Betterments are impressments of parte (minor items) ef existing facilities through the substitution of superior parte for interior parts replaced. The eest chargeable te the accounts of this classi­fication is the excess cost of now parts ever the cost at furrent prices of now parts of the hind r e^TpFolotancotee dc;on:ti, nued, on page 3_0A).