If certain goods owned by an entity were not recorded as a purchase and were not counted in ending inventory, in error, then

D. There will be no effect on cost of goods sold or profit for the period.

D.  No effect (offsetting effect) to cost of sales, hence no effect to net income. 

If goods owned by an entity were not recorded as a purchase and were not counted in ending inventory in error, it means the inventory was not sold and so does not affect the cost of goods sold account and profits as well.

The correct answer is ‘ D ’

A is answer because given error affect closing stock which will be higher and higher closing stock makes cost of goods sold understate