Closing inventory for 2011-2012 was overstated by 25,000. Which statement is correct?

1. A Option A: The cost of goods sold was overstated during 2011-2012 and income will be understated during 2012-2013
2. B Option B: The retained earnings was overstated during 2011-2012 and retained earnings will be understated during 2012-2013
3. C Option C: The cost of goods sold was understated during 2011-2012 but retained earnings will not be affected during 2012-2013
4. D Option D: The income was overstated during 2011-2012 and closing inventory will be overstated during 2012-2013

Answer checked 11 October 2026 · How we write and check questions