Sec. 21.09.01.03. Allowable Costs

A. General. Any contract cost proposed for estimating purposes or invoiced for cost-reimbursement purposes shall be allowable to the extent provided in the contract and, if inconsistent with these cost principles, approved as a deviation under Regulation .23 of this chapter. The contract shall provide that the total allowable cost of a contract is the sum of the allowable direct costs actually incurred in the performance of the contract in accordance with its terms, plus the properly allocable portion of the allowable indirect costs, subject to any specific contract limitations, less any applicable credits (such as discounts, rebates, refunds, and property disposal income), plus profit.

B. Accounting Consistency. All costs shall be accounted for in accordance with generally accepted accounting principles. In pricing a proposal, a contractor shall estimate costs in a manner consistent with its cost accounting practices used in accumulating and reporting costs to other similar activities.

C. When Allowable. The contract shall provide that costs shall be allowed to the extent they are:

(1) Reasonable;

(2) Allocable;

(3) Lawful under any applicable statute;

(4) Not unallowable under Regulations .06 through .19 of this chapter; and

(5) In the case of costs invoiced for reimbursement, actually incurred or accrued and accounted for in accordance with generally accepted accounting principles.