Suppose that Uniqlo has just completed a physical inventory count at year end, December $31,2025.$ Only the items on the shelves, in

storage, and in the receiving area were counted and costed on the FIFO basis. The inventory amounted to $$80,500.$ During the audit,

the independent CPA discovered the following additional information:

$($a$)$ There were goods in transit on December $31,2025$ from a supplier with terms FOB destination, costing $$9,700.$ Because

the goods had not arrived, they were excluded from the physical inventory count.

$($b$)$ On December $27,2025,$ a regular customer purchased goods for cash amounting to $$1,100$ and had them shipped to a

bonded warehouse for temporary storage on December $28,2025.$ The goods were shipped via common carrier with terms

FOB shipping point. The customer picked the goods up from the warehouse on January $4,2026.$ Uniqlo had paid $$550$ for

the goods and, because they were in storage, Uniqlo included them in the physical inventory count.

$($c$)$ Uniqlo, on the date of the inventory count, received notice from a supplier that goods ordered earlier, at a cost of $$3,400,$

had been delivered to the transportation company on December $28,2025$; the terms were FOB shipping point. Because

the shipment had not arrived on December $31,2025,$ it was excluded from the physical inventory.

$($d$)$ On December $31,2025,$ there were goods in transit to customers, with terms FOB shipping point, amounting to $$810$

$($expected delivery on January $8,2026).$ Because the goods had been shipped, they were excluded from the physical

inventory count.

$($e$)$ On December $31,2025,$ Uniqlo shipped $$2,000$ worth of goods to a customer, FOB destination. The goods arrived on

January $5,2026.$ Because the goods were not on hand, they were not included in the physical inventory count.

$($f$)$ Uniqlo, as the consignee, had goods on consignment that cost $$2,500.$ Because these goods were on hand as of December

$31,2025,$ they were included in the physical inventory count.