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dollar-value LIFO method of inventory valuation. Amity Leather
Prods. Co. v. Commissioner, supra at 734.
Petitioner asserts that in Richardson I we rejected the
Commissioner's determination that Investments should define its
items by model line. Accordingly, petitioner argues that
respondent’s determination in this case is an abuse of
discretion, as he argues that we have already rejected a model
line definition of item, which is less restrictive than a model
code definition of item.
We disagree with petitioner’s reading of Richardson I. In
Richardson Invs., Inc. v. Commissioner, 76 T.C. 736 (1981), the
primary issue was whether Investments “properly adopted the use
of a single LIFO inventory pool in computing inventory values
pursuant to the dollar-value, link-chain LIFO method”. Id. at
737. Respondent’s alternative argument in Richardson I was that
Investments “must compute a separate yearly index for each item
of a pool, which indexes will, in aggregate, represent the yearly
index for the pool.” Id. at 749. Rejecting this argument, the
Court found that “as long as petitioner selects a representative
portion of the inventory in a particular pool to compute an index
for the pool under the link-chain method, the computation will be
valid.” Id. Thus, we did not address the proper scope of an
item, i.e., whether items of inventory should be defined by model
line; rather, we merely indicated that the taxpayer could use a
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