21 . A company understates its ending inventory by $5, 000 . It never discovers this error . The company Is a sole proprietorship . Which statement accurately describes the company's permanent situation ? A ) Net income for the current year is overstated and the owner's equity account will permanently remain overstated since the error is never discovered . B ) Net income for the current year is understated and the owner's equity account will permanently remain understated since the error is never discovered . C ) Net income for the current year is understated . Net income for the next year will be overstated by $ 5 , 000 , but the balance in the owner's equity account will be correct at the end of year 2. D ) Net income for the current year is overstated . Net income for the next year will also be overstated by $ 5, 000 and owner's equity will never be correct since the error was not discovered . [ ) None of the above