QUESTION 1 In preparing its adjusting entries at the end of this year, Northern Exposure Company neglected to accrue commissions earned but not yet received or recorded. This error: O A Overstates this year's net income and understates both assets and retained earnings at year-end ar's net income and overstates both assets and retained earnings at year-end C. Overstates this year's net income and overstates both assets and retained earnings at year-end OD. Understates this year's net income and understates both assets and retained earnings at year-end