On January 1, 2014, Tillit Corporation

On January 1, 2014, Tillit Corporation changed its method of accounting for bad debts from the direct write-off method to the allowance method. Tillit's controller determined that an allowance of $33,000 should be established on that date.

(1) Ignoring income taxes, what is the amount of adjustment required, and where would it be reported in the financial statements?

(2) Prepare the journal entry (excluding income taxes) required to adjust the accounts.