Armstrong Inc. is a calendar-year corporation. Its financial statements for the years ended 12/31/12 and 12/31/13 contained the following errors:

2012 Ending inventory $20,000 overstatement

Depreciation expense 8,000 understatement

2013 Ending Invintory: $32,000 understatement

Depreciation Expense: $16,000 overstatement

5. Assumethatnocorrectingentriesweremadeat12/31/12,or12/31/13.Ignoringincometaxes,byhowmuch will retained earnings at 12/31/13 be overstated or understated?

A) $32,000 overstatement

B) $28,000 overstatement

C) $40,000 understatement

D) $12,000 understatement

.....I know the anser is "C". I just would like to be explained the rational behind how to get "C"