In July 2021, Profilo Corporation, which was founded in 2019, discovered that its ending inventories reported on its financial statements were misstated by the following amounts: 2019: understated by $120,000, 2020: overstated by $50,000. Profilo uses the periodic inventory system and the FIFO cost method. Tax rate is 25%. What is the effect of 2020 error only on retained earnings at January 2021? Overstated by $170,000 a. Ob. Overstated by $127,500 Understated by $127,500 C. O d. Understated by $170,000 No effect. e