If the inventory at the end of the current year is understated and the error is not caught during the following year, the effect is to?

  • A overstate income this year and understate in next year
  • B understate income this year and overstate in next year
  • C understate this year's income with no effect on the next year's
  • D overstate the income for the two-year period

The correct answer is A. overstate income this year and understate in next year

No explanation given
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