At December 31, 2010, the following amounts were reported before adjusting entries (Column I) and after adjusting entries (Column II).
| Â | I | II |
| Â | Unadjusted | Adjusted |
Prepaid Rent | $ 6,540 | $ 8,360 |
Unearned Revenue | 11,340 | 14,670 |
Wages Payable | 4,200 | 5,860 |
Accounts Receivable | 11,300 | 13,525 |
What effect did the adjusting entries have on net income before taxes for the year ended December 31, 2010?
a. $1,265 decrease
b. $945 decrease
c. $2,075 increase
d. $1,235 increase
e. $965 increase
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