I'm finishing a 13x13' room in a friend's basement. I finished my own basement including the electrical that involved installing a six-circuit sub-panel with a 60-Amp feed from the main panel located in the garage. All was Code compliant, so I am reasonably fluent in household electrical wiring.

With my friend's basement, I plan to use grooved 1" or 1.5" rigid foam board. I will secure the foam board on to the poured concrete slab walls with 1x3" furring strips via a powder actuated gun and drive pins. Standard one-half inch drywall will follow.

Does Code allow slitting the rigid foam board insulation and pressing sheathed electrical cable into the slitted cavities? Or, does Code require running conduit down along the furring strips (outside the drywall) to an electrical outlet? If the former is allowable, what kind of outlet boxes would you recommend along with how to fasten them given the situation described?

Thanks.