dubai Surfers Ltd sells surfing equipment on credit. The accounting records at 30 June 2022 reveal the following. Ignore GST.

Credit sales (for year)	$1 070 000
Credit sales returns and allowances (for year)	90 000
Accounts receivable (balance 30 June 2022)	323 500
Allowance for doubtful debts (credit balance 30 June 2022)	1 500

In the past, the companys yearly bad debts expense had been estimated at 2% of net credit sales revenue. It was decided to compare the current method with an ageing of the accounts receivable method. The following analysis was obtained with respect to the accounts receivable:

	Balance	% estimated uncollectable
Accounts not yet due	$173 600
Accounts overdue: 10-30 days	60 000	2
3160 days	42 000	10
61120 days	26 400	25
121 days and over	21 500	40
	$323 500

a) Prepare the journal entries to adjust the Allowance for Doubtful Debts at 30 June 2022 under:

1. the net credit sales method

2. the ageing of accounts receivable method.

b) Determine the balance in the Allowance for Doubtful Debts account under both methods.