James Corporation Purchased a One-Year Insurance Policy in January 2011 $€ 48,000$

James Corporation purchased a one-year insurance policy in January 2011 for $€ 48,000$ . The insurance policy is in effect from May 2011 through April 2012 . If the company neglects to make the proper year-end adjustment for the expired insurance

A) Net income and assets will be understated by $€ 32,000$ .
B) Net income and assets will be overstated by $€ 32,000$ .
C) Net income and assets will be understated by $€ 16,000$ .
D) Net income and assets will be overstated by $€ 16,000$ .