Article 27 establishes the tax accounting rules for taxpayers maintaining stock. It mandates the maintenance of inventories and allows for the deduction of the cost of goods sold (COGS). The COGS is determined by adding the cost of goods purchased to the opening stock and subtracting the closing stock value. Taxpayers on the cash method may use either the prime (direct) cost or absorption costing method, whereas those on the accrual method must use the absorption costing method. Closing stock must be valued at the lower of its book or market value. The default book valuation method is the weighted average method, which can only be changed with prior written permission from the Department.