Effect of Doubtful Accounts on Net Income During its first year of operations, Macks Plumbing Supply Co. had sales of $450,000, wrote off $7,200 of accounts as uncollectible using the direct write-off method, and reported net income of $49,500. Determine what the net income would have been if the allowance method had been used, and the company estimated that 1 3/4% of sales would be uncollectible.

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