Reads the picture's first two bytes: the border colour, which is set straight away, and the attribute for the picture area. The top two thirds of the screen ($4000-$4FFF) are cleared, and the 512 attributes of that area are filled with the picture's colour.
If Bilbo is in the dark (954D), the border and attributes are set to black instead, and the drawing is abandoned: the return address is discarded and the routine jumps to the end of 8985.