Adcock Company paid $6,600 cash to rent office space for a one-year period beginning on August 1, 2016. On December 31, 2016, Adcock Company adjusted its accounting records to reflect the months that it had used. Use the horizontal model to determine which of the following statements is correct after recording both of these transactions.

a. Total assets decreases by $6,600.

b. Net income decreases by $6,600.

c. Retained earnings decreases by $2,750 after the temporary account balances are closed.

d. Cash flow from operating activities decreases by $2,750.