I. GENERAL
This series of G/L accounts should be used to record the cost of items sold or transferred by:
- Auxiliary Enterprises of the University for the purpose of resale to customers.
- The Food and Nutrition Services departments of the Hospitals for the purpose of providing food service to patients, employees, and visitors.
- Service components of the University for the purpose of subsequent issue or transfer to other University components.
All purchases of materials and food by these areas will be charged to the appropriate inventory G/L account (refer to 15xxxx/19xxxx, Inventories). Each fiscal period these inventories will be adjusted by crediting the inventory G/L account and debiting the appropriate expense G/L account in this series for the cost of the items actually withdrawn from stock and sold, transferred, or consumed during the current fiscal period.
This series of G/L accounts should normally be charged only with the cost of items that are physically identifiable in the end product. The cost of labor incurred in preparing, fabricating, assembling such items prior to their being sold should not be charged to these G/L accounts - charge salary and wage G/L accounts (see 60xxxx, Payroll Costs).