The Constance Corporations inventory at December 31, 2021, was $134,500 (at cost) based on a physical count of inventory on hand, before any necessary adjustment for the following:

• Merchandise costing $24,500, shipped f.o.b. shipping point from a vendor on December 27, 2021, was received by Constance on January 5, 2022.
• Merchandise costing $54,500 was shipped to a customer f.o.b. shipping point on December 28, 2021, arrived at the customers location on January 6, 2022.
• Merchandise costing $30,500 was being held on hand for Jess Company on consignment.
• Estimated sales returns are 15% of annual sales. Sales revenue was $569,000 with a gross profit ratio of 20%.

What amount should Constance Corporation report as inventory in its December 31, 2021, balance sheet?

Multiple Choice

a. $196,780.

b. $172,280.

c. $233,405.

d. $226,780.