Effect of errors in physical inventory

Enter all amounts as positive numbers.

a$.$ State the effects of the error on the December $31,20$Y$8,$ balance sheet of Madison River Supply.

b$.$ State the effects of the error on the income statement of Madison River Supply for the year ended December $31,20$Y$8.$

c$.$ If uncorrected, what would be the effects of the error on the $20Y9$ income statement?

d$.$ If uncorrected, what would be the effects of the error on the December $31,20Y9,$ balance sheet?

The balance sheet would be correct, because the $20Y8$ inventory error reverses itself in $20Y9.$

The income for $20Y9$ would be understated.

The current assets in $20Y9$ would be overstated.

The current assets in $20Y9$ would be understated.