Assume the market is anticipating net income of $500,000 and internal records suggest net income is $550,000 before estimating the bad debt expense. The beginning allowance for doubtful accounts balance was $50,000, the ending AR balance is $800,000, and $20,000 of AR was written off during the period. What percentage of bad debts would the manager choose to hit the market's earnings expectation? Ignore income tax effects