Sportscar Warehouse operates in a province with a \(6 \%\) sales tax. For convenience, Sportscar Warehouse credits Sales Revenue for the total amount (selling price plus sales tax) collected from each customer. If Sportscar Warehouse fails to make an adjustment for sales taxes, which of the following will be true?

a. Net income will be overstated, and liabilities will be overstated

b. Net income will be overstated, and liabilities will be understated.

c. Net income will be understated, and liabilities will be overstated

d. Net income will be understated, and liabilities will be understated.