Effect of doubtful accounts on net income During its first year of operations, Mack's Plumbing Supply Co, had sales of $440,000, wrote off $7,000 of accounts as uncollectible using the direct write-off method, and reported net income of $48,400. Determine what the net income would have been if the allowance method had been used and the company estimated that 2% of sales would be uncollectible