Mild Traders sells goods on behalf of Take-it Traders and earns a commission of 10% based on revenue for that specific financial period. During the current financial period ending on 28 February 20.19, Take-it Traders paid a commission amounting to R11 456 and this transaction was recorded in the accounting books of Mild Traders (commission was calculated based on unaudited revenue account for the current financial period). After an independent audit of the revenue account, it was discovered that the revenue account of Take-it Traders was understated by an amount of R45 500. Take-it Traders accepted the audit finding and agreed to correct the revenue amount. On 27 February 20.19, Take-it Traders informed Mild Traders about the audit finding on the revenue account and Mild Traders sent an invoice for the outstanding commission on 28 February 20.19. No adjustment journal entry has been recorded in the accounting books of Mild Traders for the outstanding commission.

The effect of the adjustment journal entry for the outstanding commission on the basic accounting equation of Mild Traders for the year ended 28 February 20.19 will be ?

A. Assets will increase by R4 550; equity will decrease by R4 550 and liabilities will not be affected.

B. Assets will not be affected; equity will decrease R45 500 and liabilities will increase by R45 500.

C. Assets and equity will increase by R45 500 and liabilities will not be affected.

D. Assets and equity will increase by R4 550 and liabilities will not be affected.

E. Assets will not be affected; equity will decrease by R4 550 and liabilities will increase by R4 550.