Bailey's received its electric bill for December on December 31 but did not pay nor record it in the general journal.This resulted in:

Question

Quizplus · Accepted Answer

Since the electric bill was received but not recorded or paid, it will result in an understatement of expenses and an overstatement of net income. This is because the expense will not be recognized in the current period, leading to a higher net income figure than what it actually is.

Bailey's Received Its Electric Bill for December on December 31