Choose the right answer only Company XYZ received $12,000 in cash on August 1, 20X7 for one year's prepaid rent and recorded the transaction by crediting it to the rental income income statement. The adjusting entry for December 31, 20X7 is as follows Question

debit cash $7,000 and credit deferred lease proceeds, $7,000.

debit lease proceeds $7,000 and credit deferred lease proceeds $7,000.

debit deferred lease proceeds $5,000 and credit lease proceeds $5,000.

debit lease proceeds, $5,000 and credit deferred lease proceeds, $5,000.