During the taking of its physical inventory on December 31, 2014, Barry's Bike Shop incorrectly counted its inventory as $223,214 instead of the correct amount of $181,867. The effect on the balance sheet and income statement would be a. assets overstated by $41,347; retained earnings understated by $41,347; and net income statement understated by $41,347 b. assets overstated by $41,347; retained earnings understated by $41,347; and no effect on the income statement c. assets, retained earnings, and net income all overstated by $41,347 d. assets and retained earnings overstated by $41,347; and net income understated by $41,347