For the following errors, indicate the net effect on 12/31/23 Working Capital and 12/31/23 Retained Earnings, respectively.

• A 7/1/22, $200,000 cash purchase of ten-year straight-line depreciation equipment was not recorded; accordingly, no depreciation has been recorded in 2022 or 2023.
• 2022 Depreciation expense on another piece of equipment was overstated by $30,000.

Select one:

a. Overstated, No Error

b. No Error, Overstated

c. No Error, Understated

d. Understated, No Error

e. Overstated, Overstated