The ending inventory of the Ryan Company is understated in year one by $20,000. This error is not corrected in year one or in year two. The impact this error will have on total net income for years one and two combined will be

understated total income by $20,000.

no effect on total net income for the two years.

overstated total income by $20,000.

overstated net income for both years for a total overstatement of $40,000.

Please explain why