Arnold Pharmacy Reported Cost of Goods Sold as Follows

Essay

Arnold Pharmacy reported cost of goods sold as follows: Arnold made two errors:
(1) 2013 ending inventory was overstated by $6,000.
(2) 2014 ending inventory was understated by $11,000.
Instructions
Assuming the errors had not been corrected, indicate the dollar effect that the errors had on the items appearing on the financial statements listed below. Also indicate if the amounts are overstated (O) or understated (U).