![]() ![]() John's trial balance, on 31 December 2019 he owes $870 to the telephone company for services that have already been consumed. Secondly, there also is the fact that despite the absence of a disclosure in Mr. ![]() The situation, therefore, is that the trial balance states that telephone expenses for the year amounted to $3,460 however, in fact, the true telephone expense for the year was $4,330 ($3,460 + $870).Įven though the December bill has not been recorded in the books, the fact is that the service has been received, and hence expenses incurred. balance of $3,460 (as above).Īfter the trial balance had been drawn up, the December bill arrived, which was for $870. The telephone account, therefore, showed a Dr. The bill for December had not been received by 31 December 2019 when the ledger was balanced and a trial balance extracted.
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