Entries for Bad Debt Expense under the Direct Write Off and Allowance Methods The following selected transactions were taken from the records of Shipway Company for the first year of its operations ending December 31 Apr 13 Wrote off account of Dean Sheppard, $7,830 May 15 Received $3,920 as partial payment on the $10,410 account of Dan Pyle Wrote off the remaining balance as uncollectible July 27 Received $7,830 from Dean Sheppard, whose account had been written off on April 13 Reinstated the account and recorded the cash receipt Dec 31 Wrote off the following accounts as uncollectible (record as one journal entry) Paul Chapman $5,250 Duane DeRosa 3,920 Teresa Galloway 2,350 Ernie Klatt 3,290 Marty Richey 1,170 31 If necessary, record the year end adjusting entry for the uncollectible accounts If no entry is required, select No entry and leave the amount boxes blank If an amount box does not require an entry, leave it blank a Journalize the transactions under the direct write off method Apr 13 fill in the blank ac484f035fe4048 2 fill in the blank ac484f035fe4048 3 fill in the blank ac484f035fe4048 5 fill in the blank ac484f035fe4048 6 May 15 fill in the blank ac484f035fe4048 8 fill in the blank ac484f035fe4048 9 fill in the blank ac484f035fe4048 11 fill in the blank ac484f035fe4048 12 fill in the blank ac484f035fe4048 14 fill in the blank ac484f035fe4048 15 July 27 fill in the blank ac484f035fe4048 17 fill in the blank ac484f035fe4048 18 fill in the blank ac484f035fe4048 20 fill in the blank ac484f035fe4048 21 July 27 fill in the blank ac484f035fe4048 23 fill in the blank ac484f035fe4048 24 fill in the blank ac484f035fe4048 26 fill in the blank ac484f035fe4048 27 Dec 31 fill in the blank ac484f035fe4048 29 fill in the blank ac484f035fe4048 30 fill in the blank ac484f035fe4048 32 fill in the blank ac484f035fe4048 33 fill in the blank ac484f035fe4048 35 fill in the blank ac484f035fe4048 36 fill in the blank ac484f035fe4048 38 fill in the blank ac484f035fe4048 39 fill in the blank ac484f035fe4048 41 fill in the blank ac484f035fe4048 42 fill in the blank ac484f035fe4048 44 fill in the blank ac484f035fe4048 45 Dec 31 fill in the blank ac484f035fe4048 47 fill in the blank ac484f035fe4048 48 fill in the blank ac484f035fe4048 50 fill in the blank ac484f035fe4048 51 b Journalize the transactions under the allowance method Shipway Company uses the percent of credit sales method of estimating uncollectible accounts expense Based on past history and industry averages, 3 of credit sales are expected to be uncollectible Shipway Company recorded $1,273,300 of credit sales during the year Apr 13 fill in the blank 3973b803c01bfcb 2 fill in the blank 3973b803c01bfcb 3 fill in the blank 3973b803c01bfcb 5 fill in the blank 3973b803c01bfcb 6 May 15 fill in the blank 3973b803c01bfcb 8 fill in the blank 3973b803c01bfcb 9 fill in the blank 3973b803c01bfcb 11 fill in the blank 3973b803c01bfcb 12 fill in the blank 3973b803c01bfcb 14 fill in the blank 3973b803c01bfcb 15 July 27 fill in the blank 3973b803c01bfcb 17 fill in the blank 3973b803c01bfcb 18 fill in the blank 3973b803c01bfcb 20 fill in the blank 3973b803c01bfcb 21 July 27 fill in the blank 3973b803c01bfcb 23 fill in the blank 3973b803c01bfcb 24 fill in the blank 3973b803c01bfcb 26 fill in the blank 3973b803c01bfcb 27 Dec 31 fill in the blank 3973b803c01bfcb 29 fill in the blank 3973b803c01bfcb 30 fill in the blank 3973b803c01bfcb 32 fill in the blank 3973b803c01bfcb 33 fill in the blank 3973b803c01bfcb 35 fill in the blank 3973b803c01bfcb 36 fill in the blank 3973b803c01bfcb 38 fill in the blank 3973b803c01bfcb 39 fill in the blank 3973b803c01bfcb 41 fill in the blank 3973b803c01bfcb 42 fill in the blank 3973b803c01bfcb 44 fill in the blank 3973b803c01bfcb 45 Dec 31 fill in the blank 3973b803c01bfcb 47 fill in the blank 3973b803c01bfcb 48 fill in the blank 3973b803c01bfcb 50 fill in the blank 3973b803c01bfcb 51 c How much higher (lower) would Shipway Company's net income have been under the direct write off method than under the allowance method by $fill in the blank 0b215afcf004ffa 2

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 16, 2024

Entries for Bad Debt Expense under the Direct Write-Off and Allowance Methods The following selected transactions were taken from the records of Shipway Company for

Entries for Bad Debt Expense under the Direct Write-Off and Allowance Methods

The following selected transactions were taken from the records of Shipway Company for the first year of its operations ending December 31:

Apr. 13.

Wrote off account of Dean Sheppard, $7,830.

May 15.

Received $3,920 as partial payment on the $10,410 account of Dan Pyle. Wrote off the remaining balance as uncollectible.

July 27.

Received $7,830 from Dean Sheppard, whose account had been written off on April 13. Reinstated the account and recorded the cash receipt.

Dec. 31.

Wrote off the following accounts as uncollectible (record as one journal entry):

Paul Chapman	$5,250
Duane DeRosa	3,920
Teresa Galloway	2,350
Ernie Klatt	3,290
Marty Richey	1,170

31.

If necessary, record the year-end adjusting entry for the uncollectible accounts.

If no entry is required, select "No entry" and leave the amount boxes blank. If an amount box does not require an entry, leave it blank.

a. Journalize the transactions under the direct write-off method.

Apr. 13	fill in the blank ac484f035fe4048_2	fill in the blank ac484f035fe4048_3
	fill in the blank ac484f035fe4048_5	fill in the blank ac484f035fe4048_6
May 15	fill in the blank ac484f035fe4048_8	fill in the blank ac484f035fe4048_9
	fill in the blank ac484f035fe4048_11	fill in the blank ac484f035fe4048_12
	fill in the blank ac484f035fe4048_14	fill in the blank ac484f035fe4048_15
July 27	fill in the blank ac484f035fe4048_17	fill in the blank ac484f035fe4048_18
	fill in the blank ac484f035fe4048_20	fill in the blank ac484f035fe4048_21
July 27	fill in the blank ac484f035fe4048_23	fill in the blank ac484f035fe4048_24
	fill in the blank ac484f035fe4048_26	fill in the blank ac484f035fe4048_27
Dec. 31	fill in the blank ac484f035fe4048_29	fill in the blank ac484f035fe4048_30
	fill in the blank ac484f035fe4048_32	fill in the blank ac484f035fe4048_33
	fill in the blank ac484f035fe4048_35	fill in the blank ac484f035fe4048_36
	fill in the blank ac484f035fe4048_38	fill in the blank ac484f035fe4048_39
	fill in the blank ac484f035fe4048_41	fill in the blank ac484f035fe4048_42
	fill in the blank ac484f035fe4048_44	fill in the blank ac484f035fe4048_45
Dec. 31	fill in the blank ac484f035fe4048_47	fill in the blank ac484f035fe4048_48
	fill in the blank ac484f035fe4048_50	fill in the blank ac484f035fe4048_51

b. Journalize the transactions under the allowance method. Shipway Company uses the percent of credit sales method of estimating uncollectible accounts expense. Based on past history and industry averages, 3% of credit sales are expected to be uncollectible. Shipway Company recorded $1,273,300 of credit sales during the year.

Apr. 13	fill in the blank 3973b803c01bfcb_2	fill in the blank 3973b803c01bfcb_3
	fill in the blank 3973b803c01bfcb_5	fill in the blank 3973b803c01bfcb_6
May 15	fill in the blank 3973b803c01bfcb_8	fill in the blank 3973b803c01bfcb_9
	fill in the blank 3973b803c01bfcb_11	fill in the blank 3973b803c01bfcb_12
	fill in the blank 3973b803c01bfcb_14	fill in the blank 3973b803c01bfcb_15
July 27	fill in the blank 3973b803c01bfcb_17	fill in the blank 3973b803c01bfcb_18
	fill in the blank 3973b803c01bfcb_20	fill in the blank 3973b803c01bfcb_21
July 27	fill in the blank 3973b803c01bfcb_23	fill in the blank 3973b803c01bfcb_24
	fill in the blank 3973b803c01bfcb_26	fill in the blank 3973b803c01bfcb_27
Dec. 31	fill in the blank 3973b803c01bfcb_29	fill in the blank 3973b803c01bfcb_30
	fill in the blank 3973b803c01bfcb_32	fill in the blank 3973b803c01bfcb_33
	fill in the blank 3973b803c01bfcb_35	fill in the blank 3973b803c01bfcb_36
	fill in the blank 3973b803c01bfcb_38	fill in the blank 3973b803c01bfcb_39
	fill in the blank 3973b803c01bfcb_41	fill in the blank 3973b803c01bfcb_42
	fill in the blank 3973b803c01bfcb_44	fill in the blank 3973b803c01bfcb_45
Dec. 31	fill in the blank 3973b803c01bfcb_47	fill in the blank 3973b803c01bfcb_48
	fill in the blank 3973b803c01bfcb_50	fill in the blank 3973b803c01bfcb_51

c. How much higher (lower) would Shipway Company's net income have been under the direct write-off method than under the allowance method? by $fill in the blank 0b215afcf004ffa_2