On April 1, 2020, the Charlie Company paid $300,000 for a two-year lease on some office space. The company recorded this payment by debiting Rent Expense and crediting Cash for $300,000. If the company fails to make the appropriate adjusting entry for rent, what will be the effect on the balance sheet at December 31, 2020? Assets are understated by $187,500, and expenses are overstated by $112,500. b. Assets are understated by $187,500, and stockholders' equity is understated by $187,500. C. Assets are overstated by $187,500, and stockholders' equity is overstated by $187,500. d. Assets are overstated by $187,500, and expenses are overstated by $112,500. e. None of the above.