Hero Company's inventory at December 31, 20Y1, was $1.5 million based on a physical count priced at cost, and before any necessary adjustment for the following: Merchandise costing $90,000 was shipped FOB shipping point from a vendor on December 30, 20Y1 and was received and recorded on January 5, 20Y2. Goods in the shipping area were excluded from inventory although shipment was not made until January 4, 20Y2. The goods, billed to the customer FOB shipping point on December 30, 20Y1, had a cost of $120,000. During the year, Hero Company (the consignor) consigned goods with a total cost of $60,000 to Champion Company (the consignee). The annual statement by Champion Company to Hero Company indicates that 60% of the goods were sold for $42,000. What amount should Hero Company report as inventory in its December 31, 20Y1 balance sheet?