Siew Lan uses the allowance method to record bad debts expense. When accounts receivable is aged at the end of December, it is estimated that $2\%$ of Siew Lan$$s accounts receivable will be uncollectable. Accounts receivable at $31$ December are $$300,000$ and the Allowance for doubtful debts has a credit balance of $$5,000.$

Required

$($a$)$ Prepare the adjusting journal entry to record bad debts expense for the year ended $31$ December.

$($b$)$ Determine the amount of the bad debts expense if the balance in the Allowance account is a debit of $$500$ instead of a credit of $$5,000.$

Please explain step by step with explanation.