-57-
approval for too long a time for the assumption to be permissible
that the contents of an inventory can not be satisfactorily
represented for all purposes by its expression in dollars only".
Id. The Court then examined the LIFO inventory method used by
Hutzler Brothers Company and held that that method was permitted
by section 22(d) of the 1939 Code as amended and clearly
reflected income even though it was not expressly permitted by
the regulations under that section. Id. at 28-31.
Although we find Hutzler Bros. Co. v. Commissioner, supra,
to be distinguishable from the instant case, the following
explanation by the Court in that case of the LIFO inventory
method is instructive and rejects petitioner's position here:
The process envisaged by Lifo involves not so much
the ascertainment of cost as the ascertainment of what
it is of which we are to discover the cost. The last
in, first out formula assumes that the merchandise
remaining in inventory is that which was first
purchased. * * *
* * * * * * *
If we were dealing with a fabricator or
manufacturer, the first step would be to determine
which merchandise it is to which a cost is to be
attributed, and the second, to determine that cost.
* * * [Emphasis added.]
Hutzler Bros. Co. v. Commissioner, supra at 30. We see no reason
to elaborate further on the foregoing succinct explanation in the
Hutzler Bros. Co. case regarding what the "process envisaged by"
the LIFO inventory method is.
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