Hudson, Inc. is a calendar-year corporation. Its financial statements for the years 2026 contained errors as follows: Ending inventory $9,000 overstated Assume that the proper correcting entries were made at December 31, 2025. Indicate how the error may affect 2026 income and retatined earnings (ignore any tax effect). A) net inocme is overstated but retained earnings is understated by $9,000 B) net inocme is understated but retained earnings is overstated by $9,000 C) both net inocme and retained earnings are overstated by $9,000 D) no effect