A company has the following general journal adjusting entry as at 30 June: DR Insurance expense $12 000; CR Prepaid insurance $12 000. What would be the effect on the Balance Sheet if the above general journal adjusting entry was not recorded? Understate the Insurance expense, overstate Retained earnings by $12,000 and overstate the current asset Prepaid insurance by $12,000 Understate the Insurance expense, understate Retained earnings by $12,000 and understate the current asset Prepaid insurance by $12,000 Overstate the Insurance expense, understate Retained earnings by $12,000 and understate the current asset Prepaid insurance by $12,000 Overstate the Insurance expense, overstate Retained earnings by $12,000 and overstate the current asset Prepaid insurance by $12,000