6 2 4 SECTION ONE: (4 points) GIVEN: OVERSTATED UNDERSTATED Ending Inventory Purchase Discounts Bad Debt Expense Beginning Inventory 5 Sales Discounts 5 Freight-Out 3 Freight-In 2 Determine the effect on indicate overstated or understated as well as the amount): a. Cost of Goods Sold b. Net Income SECTION TWO: (4 points) At January 1, the firm reported $478 in liabilities. For the year, the firm reported revenues of $583, expenses of $508, and dividends of $44. In addition, during the year, the firm issued $25 in common stock. No other changes in equity occurred. Assets at year-end were $1,200 and liabilities increased during the year by $13. What were the assets at January 1? Answer $