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recalculations for all years of the member’s up until that year.
Those adjustments (the section 481 adjustments) are as follows:
Member 1997 1998
Nissan --- $794,993
Volkswagen $273,115 ---
Dodge --- 348,762
Chrysler --- 337,423
The parties vigorously dispute whether the section 481
adjustments (cumulatively, $1,709,293) are permissible, and it is
that question that is the primary issue before us.
Change in Method of Accounting
No member of the Huffman group requested respondent’s
permission to change its method of accounting.
Discussion
I. Introduction
The parties are in agreement that, in computing the LIFO
values of the Huffman group’s yearend inventories, the accountant
employed by the group omitted a computational step required by
section 1.472-8, Income Tax Regs. (addressing the dollar-value
method of pricing LIFO inventories). The consequence of the
accountant’s error was that, generally, he understated the LIFO
value of those inventories (which, generally, resulted in an under-
reporting of income from sales). Respondent corrected the
accountant’s error, and petitioners accept respondent’s adjustments
to the inventories of the members of the Huffman group for all of
the years in issue. Petitioners do not accept, however,
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