5. Bottom Company, a retail entity, performs a physical count of inventory at 12/31 of each year. On 12/31/2019 Bottom counts $855,000 of goods in the company's warehouse. Additionally, Bottom considers the below in transit items, all of which have already been considered by the

accounting department and reflected as appropriate in the company's 12/31/2019 general ledger inventory balance of $880,000. (i) $5,000 of goods purchased on account from Smith Company. The goods were shipped from Smith (FOB Shipping Point) on December 26, 2019 and arrived at Bottom's facility on Jan. 2. (ii) $15,000 of goods sold to Waver Co.. The goods had a historical cost to Bottom of $5,000 and were shipped from Bottom's facility (FOB Destination) on December 28, 2019 and arrived at Waver's facility on Jan. 5 (iii) $5,000 of goods purchased on account from Delight Company. The goods were shipped from Delight (FOB Destination) on December 23, 2019 and arrived at Bottom's facility on Jan. 2. (iv) $15,000 of goods sold to Maker Co.. The goods had a historical cost to Bottom of $5,000 and were shipped from Bottom's facility (FOB Shipping Point) on December 30, 2019 and arrived at Maker's facility on Jan. 6. Consider the above information, what value should Bottom use from the physical count to compare the general ledger? a. $855,000 b. $860,000 c. $865,000 d. $870,000 e. $875,000

According to the answer key, the answer is C but I am not sure why.