Ignoring taxes, if a company understates its ending inventory by

$10,000 in the current year:

a. assets for the current year will be overstated by $10,000.

b. cost of goods sold for the current year will be understated by $10,000.

c. retained earnings for the current year will be unaffected.

d. net income for the subsequent year will be overstated by $10,000.