The records of Fremont Corporation's initial and unaudited accounts show the following ending inventory balances, which must be adjusted to actual costs. Work-in-process inventory Finished goods inventory Units 145,000 20,000 Unaudited Costs $799,927 345,110 As the auditor, you have learned the following information. Ending work-in-process inventory is 40 percent complete with respect to conversion costs. Materials are added at the beginning of the manufacturing process, and overhead is applied at the rate of 80 percent of the direct labor costs. There was no finished goods inventory at the start of the period. The following additional information is also available. Units 79,000 450,000 Costs Direct Materials $ 453,100 Direct Labor $ 655,000 Beginning inventory (80% complete as to labor) Units started Current costs Units completed and transferred to finished goods inventory 1,610,000 2,218,000 384,000 b. Show the journal entry required to correct the difference between the unaudited records and actual ending balances of Work-in-Process Inventory and Finished Goods Inventory. Debit or credit Cost of Goods Sold for any difference. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet Record the difference between the unaudited records and actual ending balances of Work-in-Process Inventory and Finished Goods Inventory. Note: Enter debits before credits. Event General Journal Debit Credit Record entry Clear entry View general journal c. If the adjustment in requirement (b) is not made, will the company's income and inventories be overstated or understated? Income would have been Work in process would have been Finished goods would have been