Calculator During the taking of its physical Inventory on December 31, 2014, Barry's Bike Shop incorrectly counted its inventory as $204,836 Instead of the correct amount of $166,469. The effect on the balance sheet and income statement would be a assets overstated by $38,367; retained earnings understated by $38.367; and net income statement understated by $38.367 b. assets overstated by $38,367; retained earnings understated by $38.367; and no effect on the income statement c. assets, retained earnings, and net income all overstated by $38,367 d. assets and retained earnings overstated by $38,367; and net income understated by $38,367