Instructions The following selected transactions were taken from the records of Shipway Company for the first year of its operations ending December 31 Apr May July Dec 31. 13. Wrote of account of Dean Sheppard, $8,700, 15. Received $420 as partial payment on the $8,960 account of Dan Pyle. Wroto off the remaining balanco as uncollectible 27. Received $8,700 from Dean Sheppard, whose account had been written off on April 13. Reinstated the account and recorded the cash receipt Wrote of the following accounts as uncollectible (record as one journal entry) Paul Chapman Duane De Rosa Teresa Galloway Emie Klatt Marty Richey 31. If necessary, record the year-end adjusting entry for uncollectible accounts. $2,050 3,545 4.775 1,300 1,605 Required: 2. Journalize the transactions under the direct writo-off method. Refer to the chart of accounts for the exact worting of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW Journals will automaticaly indent a credit entry when a credit amount is entered. If no entry is required, simply skip to the next transaction b. Joumalize 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, 0.75% of credit sales are expected to be uncollectible. Shipway Company Required: a. Journalize the transactions under the direct write-off method. Refer to the chart of accounts for the exact wording of the account thes. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debitor credit entries. CNOW Journals will automatically indent a credit entry when a credit amount is entered. If no entry is required, simply skip to the next transaction. b. Journalize the transactions under the allowance method. Shipway Company uses the percent of credit saules method of estimating uncollectible accounts exponse. Based on past history and Industry averages, 0.75% of credit sales are expected to be uncollectible. Shipway Company recorded $4,018,000 of credit sales during the year. Refer to the chart of accounts for the exact wording of the account titles. CNOW Journals do not use lines for journal explanations. Every line on a journal page is used for debitor credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. W no entry is required, simply skip to the next transaction. c. How much higher (lower) would Shipway Company's net income have been under the direct write-off method than under the allowance method? Instructions Journal JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST HER CREDIT ASI 1 LUIS TOUT 2 $ 4 3 5 1 1 10 13 12 15 14 15 D. Joumalize the transactions under the allowance method. Shipway Company uses the percent of credit sales method of estimating uncollectible accounts expense dused on punt history and Industry averages, 0.78% of credit ses are expected to be collectible. Shway Company recorded 54,068.000 el credit sales during the you. Beter to the charter accounts for the exact wording of the accountities CNOW journals do not use thes for your explanations. Every time on ajoma page cosed for debitor credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered od. I no entry is required, soy ship to the next transaction INGEN JOURNAL ACCOUNTING EQUATION DAT DESCRIPTION POSTRE ORT CREDIT ATS LILITIES TOUTY 1 2 1 5 7 C. How much higher (lower) would shipway Company's not income have been under the direct write-off method than under the allowance method? by 1 2
