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Subject:  Direct selling inventory Date:  2/13/2007  9:18 AM
Author:  jlars Number:  92077 of 127536

Hi Fools,

I have to start off by saying that I'm a regular lurker/reader of this board and have nothing but awe and admiration for the regulars that, year after year, post great advice and go out of their way to help those who come here for assistance.

On to the question:

My wife began selling jewelry via home shows (jewelry parties in other people's homes) in 2006. She purchased a fair number of pieces--50 or so, costing about $3K--which she uses as display items during the home shows. She has no intention of selling any of these pieces, although technically she could. (Customers order from a catelog and have the jewelry shipped to them.) The pieces are also available for her personal use (to wear) outside of their business use.

I scanned publications 334, 538, & 535 and, while there are a couple of references to direct selling, I still can't figure out how to account for the jewelry:
- Inventory?
- Start-up costs (capitalized)?
- Straight expense (they could almost be construed as advertising when she wears them)?

If I've omitted any crucial info, just let me know.
Thanks for any help you can offer.

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