A review of the ledger of Skysong, Inc. at December 31 produces the following data for the preparation of annual adjusting entries: 1. Salaries and Wages Payable, $0. There are 8 salaried employees. 6 employees receive a salary of $1,090 each per week, and 2 employees earn $790 each per week. Employees do not work weekends. All employees worked two days after the last pay period and before December 31. 2. Unearned Rent Revenue, $443,180. The company began leasing condos in its new building on November 1. Each tenant has to make a $5,090 security deposit that is not refundable until occupancy is ended. At December 31, the company had the following rental contracts that were paid in full for the entire term of the lease: Term (in months) Number of Leases Date Monthly Rent Nov. 1 6 $3,930 6 Dec. 1 6 $10,450 4 3. Prepaid Insurance, $16,140. This balance consists of payments on two policies. The terms of the policies are as follows: Number of Months Coverage Policy Effective Date Amount A650 May 1 $7,620 12 B974 Oct. 1 8,520 24 4. Notes Payable, $80,400. This balance consists of a one year, 8% note that is dated June 1. No. Date Account Titles and Explanation Debit Credit 1. Dec. 31 2. Dec. 31 Dec. 3. 31 4. Dec. 31 Skysong is preparing for a meeting with potential investors. What is the net effect of the adjusting entries on net income? Net effect of adjusting entries is to net income by $ increase decrease