ACC 301/501 Homework 1 SECTION ONE: GIVEN: OVERSTATED UNDERSTATED Ending Inventory 4 Purchase Discounts 2 Income Tax Expense Beginning Inventory 7 Sales Discounts 5 Freight-In 3 Freight-Out 2 Determine the effect on indicate overstated or understated as well as the amount); a. Cost of Goods Sold bNet Income