A company has a fiscal year-end of December 31: (1) on October 1, $20,000 was paid for a one-year fire Insurance policy: 2) on June 30 the company advanced its chief financial officer $18,000: principal and interest at 8% on the note are due in one year, and (3) equipment costing $68.000 was purchased at the beginning of the year for cash. Depreciation on the equipment is $13.600 per year. If the adjusting entries were not recorded, would net Income be higher or lower and by how much? Net income would be higher by