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Sub. v. Commissioner, supra at 132. To properly reflect
increases attributable to inflation, we have noted that the goods
contained in a taxpayer’s item categories must have similar
characteristics, because a “system which groups like goods
together and separates dissimilar goods permits cost increases
attributable to inflation to be isolated and accurately
measured.” Id. (fn. ref. omitted). Therefore, we have found
that a “narrower definition of an item within a pool will
generally lead to a more accurate measure of inflation (i.e.,
price index) and thereby lead to a clearer reflection of income.”
Amity Leather Prods. Co. v. Commissioner, supra at 734.
We have articulated another objective of dollar-value LIFO
and a related consideration in determining the proper definition
of an item. We have noted that the dollar-value LIFO method does
not require the matching of specific goods in opening and closing
inventories, but focuses on the total dollars invested in
inventory. Wendle Ford Sales, Inc. v. Commissioner, supra at
458. Accordingly, minor modifications to an item should not
cause the item to be treated as new or separate. Id. at 459.
“This freedom from having to take into account minor
technological changes in a product represents a major objective
of the dollar-value approach.” Id. at 458. Thus, we have
cautioned that the definition of an item of inventory must not be
so narrow as to impose unreasonable administrative burdens upon a
taxpayer, thus rendering impractical the taxpayer’s use of the
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