XYZ Inc. leases its equipment for $1,000 per month. She paid cash, on November 1, X1, 6 months' rent. The 6-month period begins precisely on November 1, X1. The accountant recorded the full amount paid, $6,000, in the rental charges account.

Based on this information, what is the problem that the accountant will have to correct in order to present the financial statements for the period ended December 31, X1.

(Rental charges paid in advance as of December 31, X1 are undervalued by

$5,000.

none of the above

O Rental charges for X1 are overstated by $4,000

The rental charges paid in advance at December 31, X1 are undervalued by

$6,000.

Rental charges for X1 are overstated by $6,000