Naila Co. uses a periodic inventory system. In 2019 company management found the following two errors related to the 2018 financial statements: (1) ending inventory was understated by $17,000, and (2) a purchased of merchandise costing $20,000 was incorrectly recorded as a $2,000 purchase. As a result of these error, Prunedales cost of goods sold for 2018was:

a. overstated by $1,000

b. understated by $1,000

c. Understated by $35,000

d. overstated by $15,000

e. overstated by $35,000