The accountant for Karma Counselling Services found several errors in reviewing the unadjusted trial balance on September 30. You are to prepare correcting entries based on the following information:
a. The Counselling Fees Earned account included an entry debiting cash for $7,000 that should have been debited to Accounts Receivable.
b. Utilities Expense was debited $1,680 that should have been recorded as Telephone Expense.
c. The Office Supplies account shows a credit of $2,800 regarding the use of Cleaning Supplies.
d. A transaction involving $19,600 of service revenue performed on account was incorrectly recorded as a debit to Accounts Payable and a credit to Unearned Service Revenue.
e. Equipment was incorrectly debited for $1,200 with a corresponding credit to Accounts Payable regarding supplies that were sold to a neighbouring store on credit.
Required
Journalize the correcting entries required on September 30.
Analysis Component: The error in (b) shows that an incorrect expense account was debited. Since the net effect on the financial statements is nil after recording the correction, is it necessary to prepare a correcting entry for this type of error?