Exercise 9-4 Percent of sales method; write-off LO P2

At year-end (December 31), Chan Company estimates its bad debts as 0.50% of its annual credit sales of $777,000. Chan records its Bad Debts Expense for that estimate. On the following February 1, Chan decides that the $389 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off.

Prepare the journal entries of Chan to record these transactions and events of December 31, February 1, and June 5.

Journal entry worksheet 2 3 4 Record the estimated bad debts expense. Note: Enter debits before credits. Date General Journal Debit Credit Dec. 31 Record entry Clear entry View general journal