Sonic Youth Corporation Purchased a One-Year Insurance Policy in January

Sonic Youth Corporation purchased a one-year insurance policy in January 2018 for $49,500. The insurance policy is in effect from March 2018 through February 2019. If the company neglects to make the proper year-end adjustment for the expired insurance

A) net income and assets will be understated by $41,250.
B) net income and assets will be overstated by $41,250.
C) net income and assets will be understated by $8,250.
D) net income and assets will be overstated by $8,250.