Ingredient Method of Accounting

This method is to only be used for the following Product Categories:

#25 Chicken

#27 Deli

#30 Food Service

#41 Fresh Baked Pizza

#42 Convection Oven Products

#28 Fountain Drink - Cold

#29 Hot Drinks

#40 FCB

Under this method merchandise additions are made at cost value and no retail value. They will not be extended to a retail value as are other store products. Retail value is added to the retail book inventory via a price change after the item is sold. The retail value will be determined by the related department sales found on the closing register tape.

Example:

Purchase:

5 lb. Ham @ $1.59 lb $ 7.95

5 lb. Turkey @ $2.29 lb $11.45

5 lb. American Cheese @ $1.67 lb $ 8.35

Total $27.75

Merchandise Addition:

Cost = $27.75

Retail = $ 0

Sell:

2 lb. Ham @ $3.29 lb $ 6.58

3 lb. Turkey @ $4.39 lb. $13.17

5 Deli Sandwiches @ $2.29 $11.45

Total $31.20

Merchandise Addition:

Cost = $ 0

Retail = $31.20