-56-
method, see sec. 1.472-2, Income Tax Regs. The Court in Hutzler
Bros. Co. v. Commissioner, supra, reviewed the legislative
history of not only section 22(d) of the 1939 Code as amended,
which was applicable to the year at issue, but also section 22(d)
of the 1938 Act, 52 Stat. 459, and concluded that "the purpose of
the lawmakers was to have it [the LIFO inventory method] apply in
general terms to all those coming within its provisions." Id. at
29. The Court explained that, in contrast to the determination
under the LIFO inventory method of the merchandise to which a
cost is to be attributed in the case of a manufacturer, the
determination under the LIFO inventory method of the merchandise
to which a cost is to be attributed "becomes difficult in the
case of a retail merchant primarily because of the complications
of the retail method itself." Id. at 30. The Court added:
The * * * process engaged in by petitioner [a retail
merchant] is to reduce the price level of the retail
stock to that prevailing as of the opening inventory,
and thereby to identify the merchandise remaining in
inventory at the close of the year as that constituting
inventory at the beginning of the year to the extent of
the size of the opening inventory. That this is done by
dealing with the merchandise stated in terms of dollars
rather than of numbers or quantities is a requisite of
the aspect of department store accounting which relies
for its inventory volume on a statement in dollars
alone. [Id.]
The Court rejected respondent's contention that stating inventory
in terms of "dollars instead of other measures of quantity has
the effect of distorting the inventory content", pointing out
that the "retail method has been used with respondent's complete
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