(b) Their capacity to serve the purpose to which devoted. (c) The estimated cost of repairs necessary to maintain them. The value of the converted unit thus established plus any salvage therefrom recovered in the conversion process and less the cost of labor expended and material applied in the process of conversion shall be accounted for as the "value of the salvage" of the retired unit.** [As amended Jan. 16, 1935]

NOTE: The plan outlined in the foregoing with regard to the conversion of equipment should be followed in accounting for the physical conversion of any other units of property.

10.01-12 Expenses in connection with additions and betterments. The cost of removing old material from equipment and from buildings, bridges, wharves, tracks, and other fixed improvements, shall be charged to the appropriate operating expense accounts. Such charges shall include the cost of removing old foundations and filling old excavations, and restoring condition of grounds after addition and betterment work; rearranging or relocating existing tracks; relocating telegraph and telephone poles or lines, fences, track and other signals, buildings, bridges, trestles, culverts, and other structures, and farm and highway crossings, including crossing gates and alarms, when the provisions of § 10.01-8 are not applicable; and maintaining or protecting traffic during the progress of addition and betterment work, including the cost of constructing, maintaining, and removing temporary tracks required for maintaining traffic during the progress of the work.*t

10.01-13 Interpretation of item lists. Lists of "items," "details," etc., have been given as a part of this classification for the purpose of clearly indicating the application of the accounting rules in specific cases. The lists in every case are to be considered as merely representative, and not as excluding from any account analogous items which happen to be omitted from the list appended. On the other hand, the appearance of an item in a list warrants the inclusion of the item in the account concerned only when the text of the account also indicates inclusion, inasmuch as the same item frequently appears in more than one list. The item of boilers, for example, will be found under accounts Nos. 18, 27, 37, 44, and 45, and the proper charge in any one instance must be determined by the text of the account.**

10.01-14 Submission of questions. To the end that uniformity of accounting may be maintained from year to year, carriers shall submit all questions of doubtful interpretation of the accounting rules to the Commission for consideration and decision.**

ACCOUNTS FOR INVESTMENT IN ROAD AND EQUIPMENT

I. ROAD

The several primary accounts included in this general account are designed to show the cost of land, fixed improvements, and roadway machines and tools owned by the carrier and devoted to transportation service.

10.1 Engineering. This account shall include the pay and expenses of engineers, assistants, and clerks engaged in the survey and

*For statutory citation, see note to § 10.00-1.

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construction of new lines and extensions, or in making additions to and betterments of the carrier's road, including wharves and docks.

NOTE A: When employees designated above are engaged in the maintenance of the road, their pay and expenses while thus employed shall be charged to Operating Expenses.

NOTE B: Expenditures for tentative or preliminary surveys shall be carried in a suspense account until it is determined whether or not to continue the work. If the project is continued, expenditures for all surveys in connection therewith shall then be transferred to this account, and, if abandoned, to Operating Expenses, Income, or Profit and Loss, as may be appropriate.

NOTE C: The cost of designing, making plans and specifications, and supervising the construction of equipment shall be included in the cost of the equipment. NOTE D: The cost of stationery and printing supplies used for accounting purposes in connection with engineering work shall be included in accounts No. 74, "Stationery and printing," when not directly assignable to specific road or equipment accounts.

NOTE E: Fees and expenses of architects specially employed for designing or supervising the construction of buildings shall be included in the accounts appropriate for the cost of the buildings constructed.

In §§ 10.1 to 10.77, inclusive, the numbers to the right of the decimal point correspond with the respective account numbers in Classification of investment in road and equipment of steam roads, Interstate Commerce Commission, May 19, 1914, as amended. Amendments are noted in brackets following sections affected. Cross references to accounts are made by citing the account number, e. g., account 74, instead of the corresponding section number (§ 10.74).

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10.2 Land for transportation purposes. This account shall include the cost of land of necessary width acquired for roadway; the cost of land for station, office, shop, and other grounds; for ingress to or egress from such grounds; for borrow pits, waste banks, snow fences, sand fences, and other railway appurtenances; and for storage of material adjoining the right of way; the cost of land for wharves and docks and the cost of riparian or water rights necessary therefor; the cost of removing from the right of way and locating elsewhere the property of others, and the cost of the necessary land for relocation of the property, when such costs are assumed by the accounting carrier.

The carrier's records shall be kept in such manner as to show separately the cost of land purchased by it and the estimated values at time of acquisition of lands donated.

Proceeds from the sale of timber or of improvements purchased with right of way, less any cost of removal, shall be credited to this

Condemnation expenses, including court Removal and relocation of buildings

costs and special counsel fees. Damages to property of others. Deferred payments for right of way. Ditches for waterways when part of consideration.

Judgments and decreed costs to clear or defend titles.

Notarial fees.
Plats.

*† [As amended Dec. 27, 1935]

and other structures not purchased. Rent of land when part of consideration for purchase.

Right-of-way agents' compensation (engaged solely in acquiring right of way).

Taxes accrued and assumed at time of purchase.

NOTE: The cost of land acquired in excess of that necessary for transportation operations shall be included in balance-sheet account No. 705, "Miscellaneous physical property." When the purchase of land acquired for transportation operations involves the purchase of land not used for such purposes the charges to this account shall be based upon the estimated cost of only that portion which is used for such purposes, and the cost of the remaining land shall be included in account No. 705, "Miscellaneous physical property." Only the actual cost borne by the carrier for right of way and other lands acquired through vacation of streets and highways shall be included in this account. No donations should be considered as involved in the acquisition of such property.

10.22 Other right-of-way expenditures. This account shall include the cost actually borne by the carrier of improvement projects, other than public improvement projects, in excess of the cost of transportation property acquired in the construction of canals, farm and other private passes, pipe lines, drains, and other facilities across the carrier's right of way.* [As added Dec. 27, 1935]

10.3 Grading. This account shall include the cost of clearing and grading the roadway, and of constructing protection of a permanent character for the roadway, tracks, embankments, and cuts.

*For statutory citation, see note to § 10.00-1.

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When a part of a bridge or trestle, or the entire structure, is converted by filling into an earth embankment, and the bridge is used in lieu of a temporary trestle for the purpose of filling, the estimated cost of such temporary trestle shall be included in the cost of the filling, and charged to this account. (See Note A, under account No. 6, "Bridges, trestles, and culverts.")

When a tunnel is converted into an open cut, the cost of clearing, grubbing, and excavating shall be included in this account.

Ditches (not required by right-of-way Retaining walls.

10.4 Underground power tubes. This account shall include the cost of power tubes or conduits for underground contacts of electric railways or for underground cables of cable traction railways.

NOTE: The cost of track rails, other track material, and electric contact rails and insulators shall be charged to the accounts appropriate for such property. 10.5 Tunnels and subways. This account shall include the cost of tunnels and subways for the passage of trains, including apparatus for ventilating and lighting, and safety devices therein, other than signals.**

NOTE A: The cost of tracks, including guard rails, in tunnels shall not be charged to this account.

NOTE B: Station subways not highway crossings are includible in account No. 16, "Station and office buildings."

NOTE C: If a tunnel be converted into an open cut, the accounting shall be in accordance with § 10.01-11.

10.6 Bridges, trestles, and culverts. This account shall include the cost of the substructure and superstructure of bridges, trestles, and culverts which carry the tracks of the carrier over watercourses, ravines, public and private highways, and other railways.

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*For statutory citation, see note to § 10.00-1.

NOTE A: When a part or the entire structure of a bridge or trestle is converted, by filling, into an earth embankment, the ledger value of the structure, or of the portion thereof filled, shall be credited to this account. In case the bridge or trestle is used in lieu of a temporary trestle for the purpose of filling, the estimated cost of such temporary trestle shall be charged to account No. 3, "Grading." The ledger value of the structure, or portion thereof, filled, less the value of the salvage and the estimated cost of trestle charged to account No. 3, shall be charged to Operating Expenses.

NOTE B: The cost of bridges to carry the carrier's tracks over undergrade crossings, including the necessary piers and abutments to sustain them shall be included in this account. (See § 10.01-2 (d).)

10.7 Elevated structures. This account shall include the cost of elevated structures and foundations of elevated railway systems.

This account is applicable to structures other than earthwork, which are for the purpose of elevating tracks above the grade of streets, and which are not properly classable as bridges or trestles.**

NOTE: The cost of stations and other structures built on elevated structures shall be accounted for according to the class of the structure thus superimposed, and not in this account.

10.8 Ties. This account shall include the cost of cross, switch, bridge, and other track ties used in the construction of track for the movement or storage of locomotives and cars (including tracks in shops, fuel stations, supply yards, etc.), and the cost of additional ties subsequently laid in such tracks; also the excess cost of metal ties used in repairs of track over the cost to replace in kind wooden ties removed.

The cost of handling ties in general supply and storage yards shall be included as store expenses apportioned to this account when the ties are used for construction purposes.**

NOTE A: The cost of labor for unloading, distributing, and placing the ties in tracks, and the cost of train service in connection with the distribution of ties laid shall be charged to account No. 12, "Track laying and surfacing."

NOTE B: The cost of ties used in the construction of car floats shall be inIcluded in the cost of such floating equipment, and the cost of ties used in the construction of temporary tracks, such as gravel-pit and quarry tracks, shall be included in the appropriate clearing accounts.

10.9 Rails. This account shall include the cost of rails used in the construction of tracks for the movement or storage of locomotives

*For statutory citation, see note to § 10.00-1.

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