Take a look at the sentence again:

Sherry should have __________ everyone the truth. Then poor Rebecca would have declined a bowl of soup instead of vomiting in the bathroom once she learned the recipe included half a cup of frog tongues.

The sentence requires the past participle of tell, an irregular verb. Told is the past participle form.

Verb Simple Present Simple Past Past Participle
tell tell(s) told told

Telled, the form you chose, is a spelling error. Before you continue, review the rules for irregular verbs.

Try again to escape Grammar Hell!

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