St$.$ Joseph's Hospital began operations in December $2019$ and had patient service revenues totaling $$1,000,000($based on

customary rates$)$ for the month. Of this, $$120,000$ is billed to patients, representing their insurance deductibles and

copayments. The balance is billed to third$-$party payors, including insurance companies and government health care agencies. St$.$

Joseph's estimates that $20$ percent of these third$-$party payor charges will be deducted by contractual adjustment. The hospital's fiscal

year ends on December $31.$

Required:

Prepare the journal entries for December $2019.$ Assume $15$ percent of the amounts billed to patients will be reduced through implicit

price adjustments.

Prepare the journal entries for $2020$ assuming the following:

a$.$ $$98,000$ is collected from the patients during the year and $$9,500$ of price adjustments are granted to individuals.

b$.$ Actual contractual adjustments total $$181,000.$ The remaining receivable from third$-$party payors is collected.

The actual contractual adjustments differed from the amount initially estimated by the hospital. Briefly describe the type of

accounting change this represents and the appropriate accounting treatment.