During $2022,$ Baltic Company incurred operating expenses amounting to $$205,000,$ of which $$138,000$ was paid in cash; the balance will be paid during $2023.$ Which of the following is correct for the $2022$ year$-$end statement of financial position?

Multiple Choice

Shareholders' equity decreases $$205,000,$ assets decrease $$138,000,$ and liabilities increase $$67,000.$

Assets decrease $$205,000,$ liabilities increase $$67,000,$ and shareholders' equity decreases $$205,000.$

$$ Assets decrease $$205,000$ and shareholders' equity decreases $$205,000.$

Shareholders' equity decreases $$138,000$ and assets decrease $$138,000.$