An error in the physical count of goods on hand at the end of a period resulted in a $18000 overstatement of the ending inventory. The effect of this error in the current period is $\begin{array}{cc}\text{ Cost of Goods Sold }& \text{ Net Incom }\end{array}$

A) $\begin{array}{ccc}\text{ Understated }& & \text{ Understated }\end{array}$
B) $\begin{array}{cccc}\text{ Over stand }& & & \text{ Over stand }\end{array}$
C) $\begin{array}{cccc}\text{ Understated }& & & \text{ Over stand }\end{array}$
D) $\begin{array}{cccc}\text{ Over stand }& & & \text{ Understated }\end{array}$

Physical Count

The actual tallying of inventory goods a company has on hand to verify stock levels and assess the need for adjustment in accounting records.

Ending Inventory

The total value of goods available for sale at the end of an accounting period, calculated by adding purchases to beginning inventory and subtracting cost of goods sold.

Cost Of Goods Sold

Expenses directly tied to the production process of goods a company markets.