https://www.taxtmi.com/caselaws?id=171798 For income-tax purposes, taxable profits must be computed by reference to ascertainable facts and the actual cost of stock used in earning the year's receipts. The last-in-first-out method was rejected because it treated closing inventory as a theoretical cost residue and could reduce profits by assigning older costs to stock not shown to have been used for the relevant receipts. Commercial accounting practice could not override the statutory basis of computation where it produced a theoretical rather than factual valuation of inventory. The first-in-first-out approach was therefore upheld as the proper method in substance. en-us Tue, 13 Dec 1955 00:00:00 +0530 Mon, 03 Aug 2015 17:25:36 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=171798 For income-tax purposes, taxable profits must be computed by reference to ascertainable facts and the actual cost of stock used in earning the year's receipts. The last-in-first-out method was rejected because it treated closing inventory as a theoretical cost residue and could reduce profits by assigning older costs to stock not shown to have been used for the relevant receipts. Commercial accounting practice could not override the statutory basis of computation where it produced a theoretical rather than factual valuation of inventory. The first-in-first-out approach was therefore upheld as the proper method in substance. Case-Laws Income Tax Tue, 13 Dec 1955 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=171798