Chapter 2 or 3. An employee accidentally understated the year's direct materials cost used in production by $50,000. Which of the following correctly depicts the effect of this error?

Cost of goods manufactured will be overstated by $50,000. Cost of goods sold will be overstated by $50,000. Both cost of goods manufactured and cost of goods sold will be overstated by $50,000. Net income will be understated by $50,000. Both cost of goods manufactured and cost of goods sold will be understated by $50,000.