Bay Company began using the allowance method in 2014. On January 1, 2014, Bay had a $3,600 balance in the Accounts Receivable account and a zero balance in the Allowance for Doubtful Accounts account. During 2014, Bay provided $31,000 of service on account. The company collected $24,000 cash from account receivable. Uncollectible accounts are estimated to be 2% of sales on account. The amount of cash flow from operating activities that would appear on the 2014 statement of cash flows is:

$31,000.

$20,400.

$24,000.

$27,400.