Sheridan Inc. pays its rent of $$55200$ annually on January $1.$ If the February $28$ monthly adjusting entry for prepaid rent is omitted, which of the following will be true?

Assets will be overstated by $$4600$ and net income and owner's equity will be overstated by $$4600.$

Assets will be overstated by $$9200$ and net income and owner's equity will be understated by $$9200.$

Failure to make the adjustment does not affect the February financial statements.

Expenses will be overstated by $$4600$ and net income and owner's equity will be understated by $$4600.$