Entries for a better under the vet-off and Allowance Heads The following selected transactions were man from the records of Showay Company for a first year of its operations eeding December Apr. 13. Wrote of account of Dean Sheppard, 58.450. May 15, Receved $500 as partial payment on the 37,100 account of Dan Pyle Wrote of the remaining bwance as uncollectible May 27 Receved 10,450 from Dean Sheppard, whose account had been written off on April 13. Reinstated the account and recorded the can rece Dec. 31. Wrote of the following accounts is uncollectible record at one journal entry) Paul Chapman 12,225 Duane DeRosa 3,550 Teresa Galloway 4,770 Ernie klatt 1.275 Marty Richey 3. If necessary, record the year-end adjusting entry for uncolectible accounts ar no entry is required, select "No Entry and leave the amount toesprank. Ir an amount box does not require antiv, teve blank a. Journaliste the tramactions under the direct write-off method Apr. 13 Bad Debt Expense Accounts Receivable-Dean Sheppard MASA 1.690 May 15 Cash Bad Debt Expense Accounts Receivable-Dan Pyle I III a 8.450 July 27-reinstate Accounts Receivable-Dean Sheppard a. Journalize the transactions under the direct write-off method. Apr. 13 Bad Debt Expense 8,450 Accounts Receivable-Dean Sheppard 8,450 May 15 Cash 500 111 0 Bad Debt Expense 6,600 Accounts Receivable-Dan Pyle July 27-reinstate Accounts Receivable-Dean Sheppard 8,450 Bad Debt Expense 8,450 8,450 July 27-collection Cash Accounts Receivable-Dean Sheppard 8,450 Dec. 31-write-off Bad Debt Expense 13,510 Accounts Receivable-Paul Chapman Accounts Receivable-Duane DeRosa Accounts Receivable-Teresa Galloway Accounts Receivable-Ernie Klatt Accounts Receivable-Marty Richey Dec. 31-adjusting No Entry No Entry Feedback b. Journalize the transactions under the allowance method. Shipway Company uses the percent of credit sales method o averages, % of credit sales are expected to be uncollectible. Shipway Company recorded $3,778,000 of credit sales du Apr. 13 Allowance for Doubtful Accounts 8.450 Accounts Receivable-Dean Sheppard 8,450 Cash May 15 500 Allowance for Doubtful Accounts 6,600 110 Accounts Receivable-Dan Pyle July 27-reinstate 8,450 Accounts Receivable-Dean Sheppard Allowance for Doubtful Accounts 8,450 8,450 July 27-collection Cash Accounts Receivable-Dean Sheppard 8,450 Dec. 31-write-off Allowance for Doubtful Accounts 13,510 Accounts Receivable-Paul Chapman Accounts Receivable-Duane DeRosa Accounts Receivable-Teresa Galloway Accounts Receivable-Ernie Klatt Accounts Receivable-Marty Richey Dec. 31-adjusting Bad Debt Expense Allowance for Doubtful Accounts c. How much higher (lower) would Shipway Company's net income have been under the direct write off method than under the allowance method? Higher by
