(a) In order that the books of the municipal electric utility may show accurately the results of electric operations, each municipal electric utility shall credit the appropriate account with the cost of property, services, materials, supplies, use of space or equipment, etc., furnished to the operating municipality or any department thereof. (See also account 280, Contributions—Operating Municipality, and §§ 197.24, subd. [f], 197.26, subd. [c].)

(b) Similarly, the accounts for electric operations shall include the cost of all items applicable thereto, including expenses of the municipal electric utility paid out of funds of the operating or lessor municipality, and services, materials, water supply, supplies, use of space or equipment, paving, inspection service, etc., furnished by the operating or lessor municipality or any department thereof. (See also account 280, Contributions—Operating Municipality.)

(c) The offsetting credit or debit for the transactions covered in subdivisions (a) and (b) hereof shall be to account 280, Contributions—Operating Municipality, which may show either a credit or a debit balance.

(d) These provisions are intended to make possible an accurate determination of the results of operations of the municipal electric utility by the inclusion in the operating accounts of all applicable items whether or not they are represented by actual payments. Thus, if an office of a municipal electric utility is located in a general municipal building and if no rent is paid to the operating municipality for such space, the appropriate account for such rent shall be debited with an equitable amount and the offsetting credit shall be to account 280, Contributions—Operating Municipality. If a general municipal officer or employee collects accounts receivable for electricity and the municipal electric utility does not pay from its funds any part of his salary and expenses, an equitable portion of his pay and expenses shall be charged to the appropriate electric operating expense account and the offsetting credit shall be to account 280, Contributions—Operating Municipality. In like manner, if the municipal electric utility furnishes any service such as street lighting, power for pumping water, etc., for which no payment is received from the operating municipality, the cost to the plant of such service shall be accounted for as provided in subdivision (a) hereof and sections 197.24 and 197.26, and charged to account 280, Contributions—Operating Municipality. If payments for items enumerated in subdivisions (a) and (b) consist of a nominal amount, the difference between the cost of the service rendered and the amount paid therefor by the municipality shall be accounted for in like manner.

(e) As of the effective date of this system of accounts, there shall be determined through an analysis of all transactions from the date of the first expenditure for the municipal electric utility, the amount representing the net balance which would result if the transactions covered in this instruction and in account 280, Contributions—Operating Municipality, had been treated as provided herein. This net balance shall be placed on the books as a credit or a debit (as the case may be) to account 280, Contributions—Operating Municipality, and a copy of the journal entries showing detail and source of the information shall be filed with the commission not later than one year after the effective date of this system of accounts.