A company has a fiscal year$-$end of December $31$: $(1)$ on October $1,$$$25,000$ was paid for a one$-$year fire insurance policy; $(2)$ on June $30$ the company loaned its chief financial officer $$23,000$; principal and interest at $5\%$ on the note are due in one year; and $(3)$ equipment costing $$73,000$ was purchased at the beginning of the year for cash. Depreciation on the equipment is $$14,600$ per year.

If the adjusting entries were not recorded, would net income be higher or lower and by how much?

Note: Decreases to account classifications should be entered as a negative.

Answer is complete but not entirely correct.

$\backslash$table$[[$Adjusting Entry,Net income$],[(1),$higher,$),6,250],[(2),$lower,$(,1,150x$