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Creek Company uses the percentage of credit sales method in determining its bad debt expense. The following information comes from the accounting records of Creek

Creek Company uses the percentage of credit sales method in determining its bad debt expense. The following information comes from the accounting records of Creek Company:
Cash sales
$300,000
1,200,000
1,500,000
7,500
3%
Credit sales
Total sales
1,500,000
Credit balance in the Allowance for Doubtful Accounts
7,500
Bad debt loss rate
3%
What is the estimated bad debt expense?
a $36,000
b $37,500
c $43,500
d $45,000
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