Allowance Method for accounting for bad debt, % of accounts receivable

Hampton Company used the allowance method in accounting for bad debt losses, and over the past several years it has experienced an average loss equal to 4.5% of its accounts receivable. On December 31, 2017, the accounts receivable balance was $245,600 and the allowance for doubtful accounts had a credit balance of $1,100 before the adjusting entry.

Calculate the balance in the allowance for doubtful accounts and prepare the journal entry to record the December 31, 2017 adjusting entry for bad debt.