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RULE 36~ School Lunches The sale of fcod to any State or political subdivision thereof for the purpose of furnishing school lunches is exempt° Where such lunch rooms are opera,ed by Parent Teachers Associations or ~ther school organ- izationS of a similar character~ such sales are deemed to be sales for school lUnch purposes and the tax does not apply, RULE 37: Meals Furnished to Employees Meals furnished employees fall into either of two classes: (a) Where meals are sold to employees the tax is collectible on ~he sales price: (b) Where meals are furnished to employees aa part of their compensation, the employer is considered the consumer and the Sales Tax is payable by him. The amount of tax may be computed by calculating the cost to him of the food stuffs or ingredients used in preparing the meals over a taxable period Sndpaying the tax at the rate of two per cent. RULE 38: Materials and Parts Used in Reconditioning Used Articles for Resale. All materials, including parts used in reconditioning used articles of tangible personal property for resal~ are not subject to the tax imposed by the Ordinance. RULE 39: Memorial Stone and Monument Vendors ~emorial stones are tangible personal property, and when sold tO users or consumers the sale thereof is within the Ordinance. Where the seller o£ a memorial stone or monument agrees to install such stone or monument upon a foundation, s segregation must be made of materials used and labor costs. The seller may deduct such labor costs or services from the gross proceeds. Faithre to make a segregation will subject the entire amount to the tax. RULE 40: Manufacturers and Producers (a) Materials bought for future processing, manufacturing or conversion into articles of tangible personal property for resale, where such materials become a component part of the finished product~ are not subject to Sales or Use Tax. (b) Materials and supplies coming in direct contact with~ and which are rapidly consumed in the processing of manufactured products~ are industrial supplies which are not subject to the Sales or Use Tax; unless materials and supplies come in direct contact with and are rapidly consumed, they will not be conmidex~ed as industrial material~ or Supplies exempt from the Sales o~Use Tax.