Kingston Publishers uses the percentage-of-receivables basis to record bad debt expense. It estimates that 1% of accounts receivable will become uncollectible. Accounts receivable are £420,000 at the end of the year, and the allowance for doubtful accounts has a credit balance of £1,500.

a. Prepare the adjusting journal entry to record bad debt expense for the year.

b. If the allowance for doubtful accounts had a debit balance of £800 instead of a credit balance of £1,500, determine the amount to be reported for bad debt expense.