Charles Scrab Inc Has Beginning Inventory of $15,000, Purchases of $25,000

Multiple Choice

Charles Scrab Inc has beginning inventory of $15,000, purchases of $25,000, and ending inventory of $10,000, sales of $75,000, operating expenses of $30,000, and a tax rate of 40% for 2008. An accounting clerk input the ending inventory as $12,000. What is the effect on 2009 net income?

A) Net income for 2009 will be $10,200.
B) Net income for 2009 will be $1,200 higher than 2008.
C) Net income for 2009 will be $1,200 lower than 2008.
D) Net income for 2009 cannot be calculated with the information given.