Marlin Enterprises signed a lease for office space during their first month of business. At that time they paid a total of $12,000 for first and last months' rent. At the end of the first month, the effect on the financial statements would be $6,000 rent expense and $6,000 prepaid rent on the Statement of Financial Position. $12,000 rent expense $12,000 prepaid rent on the Statement of Financial Position. Nothing recorded because the company has not made any sales yet. On Oct. 1, 2020, Othello, Inc. signed a 1-year $75,000 note payable from First National Bank. The loan plus 6% interest is to be paid on Sept. 30, 2021. Othello's year-end is December 31. In its 2020 financial statements Othello will record interest expense of $1,125 $75,000 $375 $4,500 The accounting template approach has several limitations. These limitations include all of the following, except for printing out reports can be challenging mainly only suitable for very small businesses all of the above theoretically incorrect treatment of accounting information inability to properly quantify revenues and expenses. Which of the following statements regarding the retained earnings account is not true? Its balance is decreased by expenses Its balance is increased by the declaration of dividends. Its balance is increased by revenues. It normally has a credit balance 14 The sale of merchandise to a customer partly for cash and partly on account would require which of the following entries? Dr. Accounts payable, Dr. Accounts receivable, Cr. Sales revenue Dr. Accounts receivable, Dr. Cash, Cr. Sales revenue Dr. Cash, Dr. Accounts payable, Cr. Sales revenue Dr. Cash, Cr. Sales revenue