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

1. April 13- wrote off account of Dean Sheppard, $8,450
2. May 15- received $500 as partial payment on the $7,100 account of Dan Pyle. Wrote off the remaining balance as uncollectible.
3. July 27- received $8,450 from Dan Sheppard, whose account had been written off on April 13. Reinstated the account and recorded the cash receipt.
4. Dec 31- wrote off the following accounts as uncollectible: Paul Chapman $2,225; Duane DeRosa 3,550; Teresa Galloway 4,770; Ernie Klatt 1,275; Marty Richey 1,690
5. Dec 31- recorded the year end adjusting entry for uncollectible accounts.

Journalize the transactions under the allowance method. Shipway Company uses the percent of credit sales method of estimating uncollectible accounts. Based on past history and industry averages, 3/4 of 1% of credit sales re expected to be uncollectible. Shipway recorded $3,778,000 of credit sales during the year.