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, $3,110, May 15. Received $1,560 as partial payment on the $4,140 account of Dan Pyle. Wrote off the remaining balance as uncollectible July 27. Received $3,110 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 $2,080 Duane DeRosa 1,560 Teresa Galloway 930 Ernie Klatt 1,310 Marty Richey 470 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 Bad Debt Expense Accounts Receivable-Dean Sheppard 3,110 3,110 May 15 Cash 1,560 2,580 Bad Debt Expense Accounts Receivable-Dan Pyle 4,140 3.110 July 27 Accounts Receivable-Dean Sheppard Previous b. Joumalize the transactions under the allowance method. Shipway Company uses the percent of credit sales method of estimating uncollectible accounts expenser Based on past history and industry averages, 3% of credit sales are expected to be uncollectible. Shipway Company recorded $506,000 of credit sales during the year. Ape 13 Bad Debt Expense Accounts Receivable-Dean Sheppard May 15 Cash Bad Debt Expense Accounts Receivable-Dan Pyle July 27 Accounts Receivable-Dean Sheppard Bad Debt Expense July 2 Cash Accounts Receivable Dean Sheppard Dec 31 Allowance for Doubtful Accounts Accounts Receivable-Paul Chapman Accounts Receivable-Duane DeRosa Accounts Receivable Teresa Galloway Accounts Receivable-Ernie klatt Accounts Receivable-Marty Richey Dec 31 No entry No entry Previous