Form 970 - Application To Use Lifo Inventory Method Page 2
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Form 970 (Rev. 11-2012)
Page
Part III
Specific Goods (Unit) Method (Continued)
12
Check the box corresponding to the method that the applicant will use to determine the cost of the goods in the closing
inventories in excess of the cost of the goods in the opening inventories (see instructions):
Actual cost of goods most recently purchased or produced
Average cost of goods purchased or produced during the tax year
Actual cost of goods purchased or produced in the order of acquisition
Other (attach explanation)
Part IV
Dollar-Value Method
13
Attach a statement describing the applicant’s method of defining “items.”
14 a Did the applicant acquire any of the goods covered by this election at below-market prices?
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Yes
No
b If “Yes” to line 14a, attach a statement explaining whether the applicant did, or will, account for the goods purchased at
below-market prices and similar goods produced or acquired at market prices as separate items. If the applicant did, or will,
account for both types of goods as the same item, explain and justify.
15
Attach a statement describing the method of pooling the applicant will use for the goods covered by this election. If the
applicant will use more than one dollar-value pool, list and describe the contents of each dollar-value pool (see instructions).
16
Identify or describe the method the applicant will use to compute the LIFO value of each dollar-value pool containing goods
covered by this election (for example, double-extension method, link-chain method, or index method).
If the applicant’s method is neither the double-extension method nor the Inventory Price Index Computation method, attach a
statement describing the method in detail and justifying the applicant’s use of the selected method (see instructions).
17
Check the box corresponding to the method the applicant will use to determine the current-year cost of goods in the closing
inventories and to value the LIFO increments of the dollar-value pool(s) (see instructions).
Actual cost of goods most recently purchased or produced
Average cost of goods purchased or produced during the tax year
Actual cost of goods purchased or produced in the order of acquisition
Other (attach explanation)
Part V
Inventory Price Index Computation (IPIC) Method
18
Check the box corresponding to the method the applicant will use to compute the LIFO value of each dollar-value pool
containing goods covered by this election (see instructions).
Double-extension IPIC method
Link-chain IPIC method
19
Check the box corresponding to the table from which the applicant will select Bureau of Labor Statistics (BLS) price indexes
(see instructions).
Table 3 of the Consumer Price Index (CPI) Detailed Report
Table 6 of the Producer Price Index (PPI) Detailed Report
Other table of the PPI Detailed Report
If the applicant will use “Other table of the PPI Detailed Report,” attach a statement explaining why the other table is more
appropriate than Table 6.
20
Will the applicant use the 10 percent method (see instructions)? .
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Yes
No
21
If the applicant elects to use a representative month for selecting BLS price indexes from the applicable Detailed Report, enter
the representative month elected for each dollar-value pool.
See instructions and attach a statement if necessary.
Part VI
Other Information
22
Attach a statement describing the applicant’s method of determining the cost of inventory items (for example, standard cost
method, actual invoice cost, joint product cost method, or retail inventory method).
23
Did the applicant receive IRS consent to change the method of valuing inventories for the tax year specified
on line 1 (see instructions)? .
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Yes
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970
Form
(Rev. 11-2012)
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