North Company has a fiscal year ending on December 31. Its financial statements for the years ended December 31, 2016 and 2017 contained the following errors:

2016: Ending Inventory $19,000 understated/ Bad debt expense 2,000 overstated

2017: Ending Inventory $15,000 overstated/ Bad debt expense $1,000 understated

Assume no correcting entries have been made.

Refer to Exhibit 22-6. By how much was North's 2016 net income overstated or understated?

A. $21,000 understated

B. $17,000 overstated

C. $21,000 overstated

D. $17,000 understated