= O ADUSTEG ENTRIES ON Effects of adjusting entries on financial statements: Problem ty. - Jocelyn On August 1, Powell Company received $13,800 for six months of rent in advance. Powell credited Deferred Rent Revenue. If the appropriate adiusting entry is not made at the end of the year, what will be the effect on: (a) Income statement accounts (overstated, understated, or no effect)? (b) Net Income (overstated, understated, or no effect)? (c) Balance sheet accounts (overstated, understated, or no effect)? Income Statement Accounts Revenue Choose One Choose One Choose One Balance sheet Accounts Explanation Check