Massey Co. uses the percentage of receivables basis to record bad debts expense and concludes that \(1 \%\) of accounts receivable will become uncollectible. Accounts receivable are \(\$ 500,000\) at the end of the year, and the allowance for doubtful accounts has a credit balance of \(\$ 3,000\).

(a) Prepare the adjusting journal entry to record bad debts expense for the year.

(b) If the allowance for doubtful accounts had a debit balance of \(\$ 800\) instead of a credit balance of \(\$ 3,000\), determine the amount to be reported for bad debts expense.