Assume that in an annual audit of Pharoah Inc. at December 31, 2025, you find the following transactions near the closing date. Assuming that each of the amounts is material, state whether the merchandise should be included in the client's inventory. Transactions 1. A special machine, fabricated to order for a customer, was finished and specifically segregated in the back part of the shipping room on December 31, 2025. The customer was billed on that date and the machine excluded from imventory although it was shipped on January 4, 2026 . 2. Merchandise costing $3,640 was received on January 3,2026 , and the related purchase inwoice recorded January 5. The invoice showed the shipment was made on December 29, 2025, to.b. destination. 3. A packing case containing a product costing $4,420 was standing in the shipping room when the physical inventory was taken. It was not included in the inwentory because it was marked "Hold for shipping instructions: "Your imvestigation revealed that the customer's order was dated December 18 . 2025 , but that the case was shipped and the customer billed on January 10, 2026. The product was a stockitem of your client. 4. Merchandise recelved on January 6,2026 , costing $884 was entered in the purchase journal on January 7, 2026, The inwoice showed shipment was made fo.b. supplier's warehouse on December 31. 2025. Because it was not on hand at December 31 , it was not included in irwentory. 5. Merchandise costing $936 was received on December 28,2025 , and the invoice was not recorded, You located it in the hands of the purchasing agent, it was marked "on consignment