Revenue Ruling 2006-41, August 28, 2006

LIFO; price indexes; department stores. The June 2006 Bureau of Labor Statistics price indexes are accepted for use by department stores employing the retail inventory and last-in, first-out inventory methods for valuing inventories for tax years ended on, or with reference to, June 30, 2006.

The following Department Store Inventory Price Indexes for June 2006 were issued by the Bureau of Labor Statistics. The indexes are accepted by the Internal Revenue Service, under § 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, June 30, 2006.

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, food, liquor, tobacco, and contract departments.

BUREAU OF LABOR STATISTICS, DEPARTMENT STORE INVENTORY PRICE INDEXES BY DEPARTMENT GROUPS (January 1941 = 100, unless otherwise noted)
Groups		June 2005	June 2006	Percent Change from June 2005 to June 2006¹
1.	Piece Goods	504.8	456.6	-9.5
2.	Domestics and Draperies	519.1	490.1	-5.6
3.	Women’s and Children’s Shoes	650.4	686.5	5.6
4.	Men’s Shoes	878.2	892.0	1.6
5.	Infants’ Wear	559.9	556.3	-0.6
6.	Women’s Underwear	541.4	549.9	1.6
7.	Women’s Hosiery	340.0	349.4	2.8
8.	Women’s and Girls’ Accessories	588.9	564.4	-4.2
9.	Women’s Outerwear and Girls’ Wear	347.5	354.4	2.0
10.	Men’s Clothing	536.9	523.2	-2.6
11.	Men’s Furnishings	562.8	560.2	-0.5
12.	Boys’ Clothing and Furnishings	413.6	388.3	-6.1
13.	Jewelry	872.3	885.9	1.6
14.	Notions	810.4	815.1	0.6
15.	Toilet Articles and Drugs	997.0	996.4	-0.1
16.	Furniture and Bedding	598.7	604.1	0.9
17.	Floor Coverings	604.6	610.4	1.0
18.	Housewares	711.9	695.7	-2.3
19.	Major Appliances	204.3	203.1	-0.6
20.	Radio and Television	39.0	36.1	-7.4
21.	Recreation and Education²	78.5	76.8	-2.2
22.	Home Improvements²	137.8	139.3	1.1
23.	Automotive Accessories²	114.6	120.1	4.8

Groups 1-15: Soft Goods		552.0	552.2	0.0
Groups 16-20: Durable Goods		379.8	372.9	-1.8
Groups 21-23: Misc. Goods²		93.4	93.6	0.2

	Store Total³	490.8	489.4	-0.3

¹Absence of a minus sign before the percentage change in this column signifies a price increase.
²Indexes on a January 1986 = 100 base.
³The store total index covers all departments, including some not listed separately, except for the following: candy, food, liquor, tobacco, and contract departments.

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The principal author of this revenue ruling is Michael Burkom of the Office of Associate Chief Counsel (Income Tax and Accounting). For further information regarding this revenue ruling, contact Mr. Burkom at (202) 622-7924 (not a toll-free call).

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LIFO; Price Indexes; Department Stores

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