Suppose I m at the end of the year and I know that I have to recieve a bill for let’s say telephone costs.
I have learned that it’s a good habit to put the costs on the year that the costs are made.
Yes your process is right. the 31/12 would be done by a Journal. It suggested that use the term Accruals instead of Received Bills, as you haven’t actually received the bill.
Your 10/01 you would enter via the Purchase Invoices tab having set the Telephone company up first under Suppliers. Then the 12/01 would be Bank or Cash - Spend Money
From the framework of the question it would appear that accrual accounting is their intention. Big tick to them.
Cash accounting isn’t being considered.
In most cases, you would not know exact amount of the bill. So the common practice is to “accrual” the cost before closing the accounts to reflect the expense in the P&L report. To do this,
Dr Telephone Expense $estimated amount
Cr Accrued Expenses $estimated amount
After you have received the bill, process it through accounts payable as usual (It’s really a bad idea to record invoices via journal entries). At the end of January, reverse the above entries.
This also applies to things like travels, rent, etc. Make making accruals a routine at the end of month, so you won’t forget them.