Use This Information to Answer the Following Question

question 43

Multiple Choice

Use this information to answer the following question.

In addition, beginning merchandise inventory was $11,000 and ending merchandise inventory was $7,000.
If beginning and ending merchandise inventories were ignored in computing net income,then net income would be

• A)understated by $11,000.
• B)overstated by $4,000.
• C)understated by $7,000.
• D)understated by $4,000.