Assume that a $500 purchase invoice received close to year-end is not recorded in fiscal 2019, but the inventory is appropriately included in the ending inventory count. What impact will this have on fiscal 2020 financial reporting?

A.Operating expenses are overstated by $500.

B.Cost of sales is understated by $500.

C.Operating profit is overstated by $500.

D.Gross margin is understated.