Wave Inn is a resort located in Canada. During December 2019, Spin Jammers held its annual conference at the resort. The charges related to the conference total $440,000, of which 25% has been paid by Spin Jammers. Assuming Wave Inn fails to make the appropriate adjusting entry, which of the following is true regarding Wave Inn's December 31, 2019 statement of financial position?

Select one:

a. Equity is understated by $110,000.

b. Equity is overstated by $330,000.

c. Assets are overstated by $110,000.

d. Assets are understated by $330,000.