Ayr Inc. (Ayr) uses a periodic inventory control system. During Ayr’s inventory count on December 31, 2014, \($100,000\) of the inventory was counted twice, in error. Ayr reported inventory of \($750,000\) on December 31, 2013, and during the year it purchased \($2,000,000\) of inventory. What effect would the counting error have on net income for the year ended December 31, 2014, and on the amount of inventory reported on the balance sheet on December 31, 2014? Explain your answer.