X Company prepares monthly financial statements. Its accountant recorded the following October 1 transactions and the appropriate adjusting entries on October 31:

1. On October 1, the company paid rent for the final three months of the year. Rent was $1,575 per month.
2. On October 1, the company purchased equipment that cost $20,000, borrowing the full amount from a bank. The equipment has a life of four years and a salvage value at that time of $2,000. The company will repay the loan on December 31, along with interest at $158 per month.

8. What was the effect of the accountant's entries on total assets?

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9. What was the effect of the accountant's entries on Net Income in October?

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