Section 3-123-2 - Allowable costs(a) 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 section 3-123-24. 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 allowable portion of the allowable indirect costs, less any applicable credits such as discounts, rebates, and property disposal income.(b) All costs shall be accounted for in accordance with generally accepted accounting principles and in a manner that is consistent with the contractor's usual accounting practices in charging costs to its other activities. In pricing a proposal, a contractor shall estimate costs in a manner consistent with its cost accounting practices used in accumulating and reporting costs.(c) Costs may be allowed only to the extent they are: (1) Appropriate, as defined in section 3-123-3;(2) Allowable, as defined in section 3-123-4;(3) Lawful under any applicable law;(4) Not unallowable under sections 3-123-5 through 3-123-15 and 3-123-17 through 3-123-20; and(5) In the case of costs invoiced for reimbursement, actually incurred or accrued and accounted for in accordance with generally accepted accounting principles.[Eff 12/15/95; am and comp 11/17/97; comp 11/15/01; comp 11/25/02] (Auth: HRS § 103D-601) (Imp: HRS § 103D-601)