The ending merchandise inventory for the current year is overstated by $22,000. What effect will this error have on the following year's net income?

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Part 1

A.

The net income will be understated by $44,000.

B.

The net income will be overstated by $22,000.

C.

The net income will be overstated by $44,000.

D.

The net income will be understated by $22,000.