First Bank is considering giving Moghul Company a loan. First, however, it decides that it would be a good idea to have further discussions with Moghuls accountant. One area of particular concern is the inventory account, which has a December 31 balance of $281,000.

Discussions with the accountant reveal the following:

The physical count of the inventory did not include goods that cost $95,000 that were shipped to Moghul, FOB shipping point, on December 27 and were still in transit at year end. Moghul sold goods that cost $35,000 to Novotna Company, FOB destination, on December 28. The goods are not expected to arrive at their destination in India until January 12. The goods were not included in