Over-the-counter medicines are required by law to show the date through which the manufacturer guarantees full potency. many distributors will not accept delivery of product that is within a year of its expiration date. a batch of allround is within six months of expiration, and you need to decide what to do with it. one option is to ship the product and hope that distributors do not return it. if they do, you will need to ship new product and dispose of the returns. in addition to the cost, the returns could strain your relationship with the distributors. another option is to dispose of the whole batch up front at a cost of $100,000 and avoid the appearance of trying to dump old product on your distributors. finally, you could sell the inventory to a jobber who has a more flexible policy on expiration dates, but they are offering to buy it below cost, so there will be a net charge to you of $50,000. how do you want to handle the expiring batch of product?

Nell and kirby are in the process of negotiating their divorce agreement. what should be the tax consequences to nell and kirby if the following, considered individually, became part of the agreement? a. in consideration for her one-half interest in their personal residence, kirby will transfer to nell stock with a value of $200,000 and $50,000 of cash. kirby's cost of the stock was $150,000, and the value of the personal residence is $500,000. they purchased the residence three years ago for $300,000.nell's basis for the stock is $ xkirby's basis in the house is $ xb. nell will receive $1,000 per month for 120 months. if she dies before receiving all 120 payments, the remaining payments will be made to her estate.the payments (qualify, do not qualify) as alimony and are (included in, excluded from) nell's gross income as they are received.c. nell is to have custody of their 12-year-old son, bobby. she is to receive $1,200 per month until bobby (1) dies or (2) attains age 21 (whichever occurs first). after either of these events occurs, nell will receive only $300 per month for the remainder of her life.$ x per month is alimony that is (included in, excluded from) nell's gross income, and the remaining $ x per month is considered (child support, property settlement) and is (nontaxable, taxable) to nell.