What Is the Effect on the 2010 Financial Statements When

Multiple Choice

What is the effect on the 2010 financial statements when a capital expenditure during 2010 was incorrectly recorded as a revenue expenditure?

A) The financial statements aren't affected.
B) Assets and net income are both overstated.
C) Assets are overstated and net income was understated.
D) Assets and stockholders' equity are both understated.