b$.$If the adjusting entry in $($a$)$ were omitted, which items would be erroneously stated on $(1)$ the income statement for the year and $(2)$ the balance sheet as of December $31?$

$1.$ The income statement for the year

Depreciation expenseNet income

would be understated.

Depreciation expenseNet income

would be overstated.

$2.$ The balance sheet as of December $31$

Accumulated depreciationTotal assets

would be understated, and

accumulated depreciationowner's equitytotal assets

would be overstated.

Accumulated depreciationOwner's equityTotal assets

would be overstated.