Question 13 Feine Co. accepted delivery of merchandise which it purchased on account. As of December 31, Feine had recorded the transaction, but did not include the merchandise in inventory. The effect of this on its financial statements for December 31 would be net income was overstated and current assets were understated. net income, current assets, and retained earnings were understated net income was correct and current assets were understated net income was understated and current liabilities were overstated. SUBMIT