At the end of the year on 31 December, closing inventory of $5000 was entered wrongly in the financial statements as $3000. What impact will this have on the financial statements for the year?
- Aprofit for the year: no effect; total assets: understated
- Bprofit for the year: overstated; total assets: overstated
- Cprofit for the year: understated; total assets: no effect
- Dprofit for the year: understated; total assets: understated