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FOREST SERVICE HANDBOOK
Portland, Oregon
FSH 6509.11f - WORKING CAPITAL FUND ACCOUNTING OPERATIONS
HANDBOOK
R6 Supplement No. 6509.11f-94-3
Effective April 1, 1994
POSTING NOTICE. Supplements are numbered consecutively by title and
calendar year. Post by document name. Remove entire document, if one exists, and
replace with this supplement. The last R6 Supplement to this handbook was
6509.11f-94-2.
This supplement supersedes Supplement 6509.11f-91-1.
Document Name
Superseded New
(Number of Sheets)
6509.11f,60
7
Page Code
61--1 through 61.13--2
4
Digest:
Updates FY 1994 Seed and Seedling rates for Region 6. Makes editorial corrections
on other sections and transfers the responsibility for inventory accounting
adjustments to the nursery forests.
/s/ John E. Lowe
JOHN E. LOWE
Regional Forester
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FSH 6509.11f - WORKING CAPITAL FUND ACCOUNTING OPERATIONS
HANDBOOK
R6 SUPPLEMENT 6509.11f-94-3
EFFECTIVE 04/01/94
CHAPTER 60 - NURSERY SERVICE
61 - ACCOUNTING.
61.1 - Recording Entries Except Direct and Indirect Cost.
61.13 - Recording Sales of Nursery Goods and Services and Adjusting Inventory for
Cost of Goods Sold.
1. Services and transportation furnished outside the Forest Service. It is not
anticipated that the nursery will pay outside sources for special services a forest
requests for seedlings and seed ordered. This includes:
-Special seed tests or treatments.
-Any other special services requested for seed and seedlings, other than that
provided at the nursery.
The ordering forest shall pay the vendor directly for the services. The procedure for
making direct payment is described below:
a. Direct payments for special services. The nursery will:
(1) Prepare the purchase order for the services requested.
(2) Use the purchase order number of the ordering forest along with the
ordering forest's fund code and management code.
(3) Show National Finance Center (NFC) as the office to be billed.
The original of the purchase order will be sent to the vendor who is to supply the
services. The nursery will forward the appropriate copy to NFC and all other copies
to the ordering forest for their files, acknowledging receipt of services performed
and answering any vendor payment inquiries.
b. Direct payment to commercial carrier. The nursery will:
(1) Prepare the Government Bill of Lading using the NFC override procedure
to charge the ordering forest directly.
(2) Send copies to Budget and Finance section of the ordering forests as an
obligation advice.
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The obligations and the payments should be charged to the benefitting project
funds.
2. Quarterly cost of goods sold adjustment. When seedlings are removed
from inventory on hand, an accounting adjustment is necessary to charge out to
account 681 (cost of goods sold) at the cost per thousand calculated by the Working
Capital Fund (WCF) Financial Manager based on the number of firm orders for
seedlings available in the nursery and the amount invested in seedlings in the
inventory of each age class. Nursery forests are now responsible for this accounting
adjustment beginning in FY 1994. Reduce (credit) inventory accounts and charge
cost of goods sold expense accounts for seedlings and seed removed from inventory
through sale, destruction, or (in the case of seed) sowing. Calculate the adjustment
quarterly by multiplying volume disposed of times "direct expense cost" published
by the WCF Financial Manager.
-Volume of seedlings sold or destroyed X cost per M = adjustment.
-Volume of seed sold, destroyed, or sown X cost per lb. = adjustment.
Direct expense cost does not include indirect expenses included in the selling price.
Further procedures can be found on pages 9-5 through 9-7 of the WCF User's Guide.
3. Cost of goods sold basis (for nursery use only). The following direct
expense cost is provided for the nurseries to make the appropriate adjustment in
the same quarter seedlings are sold. Indirect costs and lift and pack costs are not to
be included. These follow by nursery:
Age Class
Bend Pine
Wind River
J.H. Stone
1-0
2-0
3-0
4-0
1-0 Bedhouse
1-1 Field
2-1 Field
UP 1&2 Field
1.5-0
$ 32.23
46.04
-----
$ 80.92
115.60
150.29
231.21
115.60
254.33
289.01
138.72
------
$ 37.45
53.50
------------117.70
-------------
----------------46.04
61.13a - Billing Procedures for Sale of Tree Seedlings.
Forest orders for nursery stock.
1. Obligation for seedlings a forest ordered grown in excess of its needs. A
forest's obligation for seedlings has been the number allocated to the forest for
delivery in the current fiscal year. R-6 supplement to FSM 2473 expands this
policy. Not only is a forest obligated to pay for seedlings allocated, but if a forest
does not take delivery of seedlings ordered grown, it must pay the nursery for those
seedlings at the going rate. For example, if in FY 1992 a forest orders 20M
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seedlings to be grown for delivery in FY 1994, but subsequently orders delivery of
only 15M seedlings in FY 1994, it must pay the nursery the going rate plus any
additional cost in disposing of the 5M excess seedlings.
2. Obligating seedlings allocated. Based on forest's orders for seedlings for
delivery in the current fiscal year, the nurseries inform the forests by September 1
each year of trees allocated to them (FSM 2473). Forests are obligated to pay for
the trees allocated.
If a forest takes delivery of fewer seedlings than the number allocated, it must pay
for the seedlings not taken. In this event a nursery shall bill for losses it will incur
because the forest will not take delivery.
68 - FINANCIAL MANAGEMENT.
68.1 - Nursery Services.
68.11 - Financial Estimate. As directed by the parent text, form FS-6500-30,
Financial Estimate, is to be submitted to the WCF Financial Manager by October 1
annually. One copy is sufficient.
At the end of the second quarter, each nursery shall submit to the WCF Financial
Manager a copy of the FS-6500-30, Financial Estimate, after posting the actual
income and expense through March 31. Submit to the WCF Financial Manager by
May 10.
Obtain the following data from the sources indicated:
-Income Statement from NFC produced quarterly and updated as needed in
Regional Office Financial Management (ROFM).
-Balance Sheet statement from NFC produced quarterly.
68.12 - Inventory Distribution and Price Development.
1. Inventories.
a. Planting Stock. By September 30 of each year, nurseries shall inventory
all seedling stock, but must include in the count only plantable seedlings (gross less
culls) that are covered by firm orders. Selling prices are developed on firm order
volumes which are available in the nursery. For all trees 1-0 age class and over,
inventory and report volumes by letter to ROFM by November 1, annually.
b. Seed. Nurseries shall take a physical inventory of seed by August each
year, as follows:
(1) Weigh containers opened since last physical inventory.
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(2) Accept without reweighing the weight shown on seed lot record cards, if
the containers were not opened since the last physical inventory.
2. Distribution of seedling inventory cost. Two year old seedling stock will be
used as a standard factor 1.0 in Region 6 for determining cost factors.
3. Determination of seedling inventory values, cost of sales, and selling
prices.
a. Inventory value and cost of sales. The cost of seedlings sold and the cost of
goods sold adjustment must be recorded on the WCF Financial Statement in the
quarter in which the sales occurred. The adjustment process is explained in this
supplement, section 61.13. The seedling inventory should be developed as follows:
Seedling Book Inventory
Beginning
Inventory
(Same as
Ending
Inventory on
Last Report)
Seedlings
Lifted
Since Last
Report
Seedlings
Shipped
Since Last
Report
Seedlings
Destroyed
Since Last
Report
Transplants
Since Last Ending
Report
Inventory
On September 30 add a column to show the physical inventory count of all stock.
The nursery shall develop report volume of seedlings on firm orders only for
quarterly book inventory because seedlings shipped, but not billed, are used in
determining accrued income for a nursery.
b. Selling prices. The WCF Financial Manager shall establish selling prices
for seedlings. Prices for the current fiscal year shall be published by January 31.
Until this is published, forests should use the most recent selling prices for
determining obligations incurred for seedling orders.
The WCF Financial Manager must have the following information from the nursery
forests for preparing selling prices of seedlings or seed:
(1) Changes to the fiscal year budget showing planned seedling expenditures
by quarters if significantly different than reported in the initial budget submission.
(2) Volumes of forest and other buyers firm orders which are available in
nursery by age class.
(3) Estimated volumes of seedlings to be sold during the current year by age
class.
(4) Pounds of seed collected by nursery doing extraction.
(5) Seed inventory in pounds as of September 30 of previous year.
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(6) Estimated seed sales in pounds for current fiscal year.
(7) Indirect and maintenance costs for the current year shall be taken from
the nurseries' budgets.
Submit the above information to reach the WCF Financial Manager in the ROFM
by November 1 of each year.
c. Seedling purchases. By September 1, each nursery shall transmit the
seedling inventory to each ordering forest using the Inventory Ordering System
(INVORD) forms on the Forms Entry System (FES) database for tree inventory,
request and allocation. This serves as the lift and pack specification database.
By November 15, the ordering forest shall return form generated through INVORD
to the nursery, showing district allocation for each lot number together with
management codes and special services. This document authorizes the nursery to
lift and pack requested seedlings.
At the same time, the forest shall also transmit a summary of the Lift and Pack, or
allocation requests (report on the DG) showing amount ordered, management
code(s), and total obligation for each management code by using the latest rate per
M by age class to their Budget and Finance section. This document shall be used to
obligate funds for seedlings ordered until billed by the nursery.
After seedlings have been lifted and packed, the nurseries shall prepare a billing on
an AD-742, Transfer and Adjustment Voucher, to be submitted to NFC, with a copy
to the ordering forest for the actual amount of seedlings processed or destroyed
which that ordering forest is obligated to take.
d. Current nursery seed and seedling selling prices. The following prices are
for FY 1994:
(1) Seed. There is a single price per pound for the entire region for all
species in each Nursery Seed Bank. The selling price per pound for FY 1994 is:
-Seed Price per pound---------------------------------------- $ 75.00
-Increased Replacement Cost per pound---------------0.00
Total Selling Price per pound ----------------------- $ 75.00
Note that the replacement cost is zero. This indicates that it is costing less to
replace seed in inventory than the average cost per pound on hand.
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(2) Seedlings. Effective October 1, 1993 all nurseries will charge a single
price per M seedlings by age class for the entire region for all species. The selling
price per M for FY 1994 is:
Age Class
UP
Production
Price per M
1-0
$ 53
2-0
76
3-0
99
4-0
153
1-0 Bedhouse 76
1-1 Field
168
2-1 Field
191
1&2 Field
92
1.5-0
76
Lift and Pack
Price per M
Total Selling
Price per M
$ 93
109
120
120
93
131
147
120
109
$ 146
185
219
273
169
299
338
212
185
The above prices do not include any special service costs, which will be billed in
addition to the standard rates.