At the end of the current year, XYZed Company failed to record the purchase of some goods and also failed to include these goods in its ending inventory.

For the current year, these two errors caused:

HINT:In this situation, goods available for sale is affected; is it too high or too low? To where does that error flow through?

A. Goods available for sale, cost of goods sold, and income to be overstated

B.Ending inventory, cost of goods sold, and retained earnings to be understated

C.Ending inventory, goods available for sale, and retained earnings to be understated

D.No effect on income, working capital, or retained earnings