Rev. Rul. 87-81

1987-2 C.B. 142, 1987-34 I.R.B. 4.

LIFO, PRICE INDEXES; DEPARTMENT STORES

Published: August 24, 1987

Section 472.-Last-in, First-out Inventories, 26 CFR 1.472-1: Last-in, first-out inventories

  LIFO, price indexes; department stores. The May 1987 Bureau of Labor Statistics price indexes are accepted for use by department stores employing the retail inventory and last-in, first-out inventory method for valuing inventories for tax years ended on, or with reference to, May 31, 1987.

  The following price indexes for May 1987 were issued by the Bureau of Labor Statistics on June 25, 1987, for use by department stores, and are accepted by the Internal Revenue Service, under section 1.472-1(k) of the Income Tax Regulations and Rev. Proc. 86-46, 1986-50 I.R.B. 6, for appropriate application to inventories of department stores employing the retail inventory and last-in, first- out inventory methods for tax years ended on, or with reference to, May 31, 1987.

  Indexes are prepared on a national basis for the store total, for 23 major groups of departments, and for three special combinations - soft goods, durable goods and miscellaneous goods. The store total index covers all departments, including some not listed separately, with the following exceptions: candy, foods, liquor, tobacco, as well as contract departments.

                 BUREAU OF LABOR STATISTICS, DEPARTMENT STORE
                 INVENTORY PRICE INDEXES BY DEPARTMENT STORES
                  (January 1941 = 100 unless otherwise noted
                                                                      Percent
                                                                       Change
                                                                       from May
                                               May          May         1986 to
                      Groups                  1986         1987        May 1987
                                                                          [FN1]
-------------------------------------------------------------------------------
     1.  Piece Goods                             401.1        397.1         1.0
     2.  Domestics and
         Draperies                               548.3        566.2         3.3
     3.  Women's and
         Children's Shoes                        533.0        555.0         4.1
     4.  Men's Shoes                             730.0        754.9         3.4
     5.  Infant's Wear                           533.9        535.5         0.3
     6.  Women's Underwear                       427.8        439.6         2.8
     7.  Women's and Girl's
         Hosiery                                 236.1        238.4         1.0
     8.  Women's and Girl's
         Accessories                             455.5        470.1         3.2
     9.  Women's Outerwear and
         Girls' Wear                             336.9        372.5        10.6
    10.  Men's Clothing                          475.8        504.3         6.0
    11.  Men's Furnishings                       482.7        499.6         3.5
    12.  Boy's Clothing and
         Furnishings                             440.8        428.1         2.9
    13.  Jewelry                                 669.0        709.7         6.1
    14.  Notions                                 472.0        482.1         2.1
    15.  Toilet Articles and
         Drugs                                   661.6        676.8         2.3
    16.  Furniture and
         Bedding                                 543.4        564.9         4.0
    17.  Floor Coverings                         467.7        464.6        -0.7
    18.  Housewares                              711.8        727.2         2.2
    19.  Major Appliances                        249.1        252.3         1.3
    20.  Radio and Television                    100.3         97.9        -2.4
    21.  Recreation and
         Education [FN2]                         100.3        101.7         1.4
    22.  Home Improvements [FN2]                  97.5        102.7         5.3
    23.  Auto Accessories [FN2]                   99.5        100.1         0.6
          Groups 1-15: Soft Goods                478.6        501.4         4.8
          Groups 16-20: Durable Goods            446.1        451.4         1.2
          Groups 21-23: Misc. Goods [FN2]         99.7        101.6         1.9
         Store Total                             469.0        484.4         3.3
FN1. Absence of a minus sign before percentage change in this column signifies
  price increase.
FN2. Indexes on a January 1986 = 100 base.

Rev. Rul. 87-81, 1987-2 C.B. 142, 1987-34 I.R.B. 4