REVENUE RULE 95-25

1995-13 I.R.B. 5

Internal Revenue Service

Revenue Ruling

LIFO; PRICE INDEXES; DEPARTMENT STORES

Published: March 27, 1995

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

LIFO; price indexes; department stores. The January 1995 Bureau of Labor Statistics price indexes are accepted for use by department stores employing the retail inventory and last-in, first-out inventory methods of valuing inventories for tax years ended on, or with reference to, January 31, 1995.

The following Department Store Inventory Price Indexes for January 1995 were issued by the Bureau of Labor Statistics on February 15, 1995. The indexes are accepted by the Internal Revenue Service, under s 1.472-1(k) of the Income Tax Regulations and Rev. Proc. 86-46, 1986-2 C.B. 739, 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, January 31, 1995.

The Department Store Inventory Price Indexes are prepared on a national basis and include (a) 23 major groups of departments, (b) three special combinations of the major groups--soft goods, durable goods, and miscellaneous goods, and (c) a store total, which covers all departments, including some not listed separately, except for the following: candy, foods, liquor, tobacco, and contract departments.

BUREAU OF LABOR STATISTICS, DEPARTMENT STORE INVENTORY PRICE INDEXES BY DEPARTMENT GROUPS
(January 1941 = 100, unless otherwise noted)

Groups January 1994/January 1995/Percent Change from Jan. 1994 to Jan. 1995 [Fn1]
1. Piece Goods 450.9 480.1 6.5
2. Domestics and Draperies 651.0 632.3 -2.9
3. Women's and Children's Shoes 644.7 627.4 -2.7
4. Men's Shoes 914.6 917.6 0.3
5. Infants' Wear 601.4 613.6 2.0
6. Women's Underwear 512.4 528.0 3.0
7. Women's Hosiery 277.9 282.3 1.6
8. Women's and Girls' Accessories 564.3 542.2 -3.9
9. Women's Outerwear and Girls' Wear 414.9 398.4 -4.0
10. Men's Clothing 592.0 595.7 0.6
11. Men's Furnishings 550.8 553.7 0.5
12. Boys' Clothing and Furnishings 474.5 480.5 1.3
13. Jewelry 974.8 1005.9 3.2
14. Notions 617.6 746.3 20.8
15. Toilet Articles and Drugs 844.4 842.6 -0.2
16. Furniture and Bedding 632.3 646.7 2.3
17. Floor Coverings 520.9 571.8 9.8
18. Housewares 777.9 775.9 -0.3
19. Major Appliances 248.6 248.5 0.0
20. Radio and Television 86.0 84.2 -2.1
21. Recreation and Education [fn2] 115.0 114.6 -0.3
22. Home Improvements [fn2] 123.6 122.0 -1.3
23. Auto Accessories [fn2] 106.6 106.4 -0.2
Groups 1 - 15: Soft Goods 583.7 579.3 -0.8
Groups 16 - 20: Durable Goods 462.8 464.5 0.4
Groups 21 - 23: Misc. Goods [fn2] 114.7 114.1 -0.5
Store Total [fn3] 544.0 541.2 -0.5

FN1. Absence of a minus sign before percentage change in this column signifies price increase.
FN2. Indexes on a January 1986 = 100 base.
FN3. The store total index covers all departments, including some not listed separately, except for the following: candy, foods, liquor, tobacco, and contract departments.

DRAFTING INFORMATION

The principal author of this revenue ruling is Stan Michaels of the Office of Assistant Chief Counsel (Income Tax and Accounting). For further information regarding this revenue ruling, contact Mr. Michaels on (202) 622- 4970 (not a toll-free call).

Rev. Rul. 95-25, 1995-13 I.R.B. 5