Charles Scrab Inc has beginning inventory of $15,000, purchases of $25,000, and ending inventory of $10,000, sales of $75,000, operating expenses of $30,000, and a tax rate of 40% for 2010. An accounting clerk input the ending inventory as $12,000. What is the effect on 2011 net income?
A. Net income for 2011 will be $1,200 higher than 2010.
B. Net income for 2011 will be $1,200 lower than 2010.
C. Net income for 2011 will be $10,200.
D. Net income for 2011 cannot be calculated with the information given.