During a year-end physical inventory count, Air Jordan basketball shoes in the backroom were mistakenly counted twice, thus ending inventory was overstated by $7,835.

How would this error affect the following accounts on the company's Income Statement?

1. Ending inventory

a) Understated

b) Overstated

c) Unaffected by the error

2. Cost of Goods Available for Sale

a) Understated

b) Overstated

c) Unaffected by the error

3. Cost of goods sold

a) Understated

b) Overstated

c) Unaffected by the error

4. Gross Profit

a) Understated

b) Overstated

c) Unaffected by the error