On June $1,$ the company paid $$1,200$ in advance for $12$ months of rent, with the rental period beginning on June

$1.$ This $$1,200$ was recorded as Rent Expense. $[$Yes$,$ they did it wrong, but we have to work with what they did.$]$

As of the end of the year, no entry has yet been made to adjust the amount initially $($incorrectly$)$ recorded.

Which of the following will be included in the ADJUSTING ENTRY necessary on December $31?$

$$ DEBIT to RENT EXPENSE for $$500$

$$ DEBIT to PREPAID RENT for $$500$

$$ DEBIT to PREPAID RENT for $$700$

$$ DEBIT to RENT EXPENSE for $$700$

$$ CREDIT to PREPAID RENT for $$500$

$$ DEBIT to CASH for $$700$