Problem: Accrued salaries payable of $51,000 were not recorded at December 31, 2010. Office supplies on hand of $24,000 at December 31, 2011 were erroneously treated as expense instead of supplies inventory. Neither of these errors was discovered nor corrected. The effect of these two errors would cause
A- 2011 net income to be understated $75,000 and December 31, 2011 retained earnings to be understated $24,000.
B- 2011 net income and December 31, 2011 retained earnings to be understated $24,000 each.
C- 2010 net income and December 31, 2010 retained earnings to be understated $51,000 each.
D- 2010 net income to be overstated $27,000 and 2011 net income to be understated $24,000.