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Blossom Company took a physical inventory on December 31 and determined that goods costing $221,500 were on hand. Not included in the physical count were $28,000 of goods purchased from Splish Brothers Inc., FOB, shipping point, and $28,000 of goods sold to Novak Corp. for $30,000, FOB destination. Both the Splish Brothers purchase and the Novak sale were in transit at year-end.
Problem 1: What amount should Blossom report as its December 31 inventory?
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