Tonale Company Began Operations in 2014

Multiple Choice

Tonale Company began operations in 2014.During the first two years of operations,Tonale made undiscovered errors in taking its year-end inventories that overstated 2014 ending inventory by $50,000 and overstated 2015 ending inventory by $40,000.The combined effect of these errors on reported income is 2014 2015 2016

A) overstated $50,000 overstated $90,000 understated $40,000
B) overstated $50,000 overstated $40,000 not affected
C) understated $50,000 understated $90,000 not affected
D) overstated $50,000 understated $10,000 understated $40,000