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Indigo Corp. has outstanding accounts receivable totaling $$5\mathrm{.}40$ million as of December $31$ and sales on credit during the year of $$20$ million. There is also a credit balance of $$11000$ in the allowance for doubtful accounts. If the company estimates that $5\%$ of its outstanding receivables will be uncollectible, what amount of bad debt expense will be reported on Indigo's income statement?

$$259000.$

$$270000.$

$$1000000.$

$$281000.$

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