Effect of errors in physical inventory

instead of the correct amount of $$576,900.$

Enter all amounts as positive numbers.

a$.$ State the effects of the error on the December $31,2$UY$1,$ Darance sneet of Fonda INotorcycie Snop.

b$.$ State the effects of the error on the income statement of Fonda Motorcycle Shop for the year ended December $31,20Y1.$

c$.$ If uncorrected, what would be the effects of the error on the $20Y2$ income statement?

d$.$ If uncorrected, what would be the effects of the error on the December $31,20Y2,$ balance sheet?

The December $31,20$Y$2,$ balance sheet would be correct, since the $20Y1$ inventory error reverses itself in $20Y2.$

In the December $31,20$Y$2,$ balance sheet, inventory would be understated.

In the December $31,20Y2,$ balance sheet, inventory would be overstated.

In the December $31,20Y2,$ balance sheet, retained earnings would be understated.