At December $31,2017,$ Island Equipment understated ending inventory by $$2,500.$ How does this enor alfect cost of goods sold and net income for $2017?$

A$.$ Understates costs of goods soid and overstates net income

B$.$ Leaves both cost of goods sold and net income correct because the errors cancel each other

C$.$ Overstates cost of goods sold and understates net income

D$.$ Overstates both cost of goods sold and net income