Chapter 7 Accounting for Receivables At year-end (December 31), Chan Company estimates its bad debts as 1% of its annual credit sales of Exercise 7-6 $487.500. Chan records its bad debts expense for that estimate. On the following February 1, Chan de- Percent of sales met cides that the $580 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park un- write-off expectedly pays the amount previously written off. Prepare Chan's journal entries to record the transactions of December 31, February 1, and June 5