Entity A had $1,000 of supplies on hand on January 1 and purchased $400 more during the year. At December 31, $200 of supplies remained. If Entity A does not make the proper adjusting entry at the end of the year, which of the following is correct? Hint: Make the correct adjusting entry first.

a. Net income will be understated

b. Current assets will be overstated

c. Current assets will be understated