Mogul Company ships merchandise to Ski Outfit in a consignment arrangement. The arrangement specifies that Ski Outfit will attempt to sell the merchandise, and in return, Mogul will pay to Ski Outfit a commission of 10% of the selling price on any merchandise sold. During the year, Mogul ships inventory with a cost of $94,000 to Ski Outfit and pays shipping costs of $17,800. By the end of the year, $74,000 of the merchandise has been sold to customers for a total of $99,000. Mogul allocates $13,000 of the shipping costs to inventory sold and the other $4,800 to inventory not sold. Mogul also paid advertising costs during the year of $17,000. What amount of inventory will Mogul report at year end?

Multiple Choice

• $61,800.

• $44,800.

• $20,000.

• $24,800.