A calendar year company plans to pay its December gas bill in January. As of December 31, no adjusting entry has been recorded. As a result, the balance sheet is accurate, but the income statement is understated net income is understated and liabilities are overstated net income is overstated and liabilities are overstated net income is understated and liabilities are understated the income statement and the balance sheet are both accurate because the bill won't be paid until January net income is overstated and liabilities are understated