Use the Following Information for Questions
Dexter, Inc -Assume That No Correcting Entries Were Made at December 31

Multiple Choice

Use the following information for questions
Dexter, Inc.is a calendar-year corporation.Its financial statements for the years 2007 and 2006 contained errors as follows: $$\begin{array} { l l l } &{ 2007 } & { 2006 }\\\text { Ending inventory } &{ \$ 3,000 \text { overstated } } & { \$ 8,000 \text { overstated } } \\\text { Depreciation expense } & \$ 2,000 \text { understated } & \$ 6,000 \text { overstated }\end{array}$$
-Assume that no correcting entries were made at December 31, 2006, or December 31, 2007 and that no additional errors occurred in 2008.Ignoring income taxes, by how much will working capital at December 31, 2008 be overstated or understated?

A) $0
B) $2,000 overstated
C) $2,000 understated
D) $5,000 understated