What we're looking at here is the base case of a dotted list:
(a b . rest)
(a . rest)
rest
The syntax for a single cons cell is (a . b). The (a b c . d) syntax is a shorthand for (a . (b . (c . d))), and the (a b c) syntax is a shorthand for (a b c . ()), where () is nil. Here's a bit of a demonstration: