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On May 31, 2021, Joe's Car Lot sold Frank a used car on account for $20,000. Joe's Car Lot uses the accrual method. In 2022,
On May 31, 2021, Joe's Car Lot sold Frank a used car on account for $20,000. Joe's Car Lot uses the accrual method. In 2022, when the balance due on the account was $6,000, Frank filed for bankruptcy and Joe's Car Lot was notified that he could not expect to receive any of the amount owed to him. In 2023 final settlement was made and Joe's Car Lot received $2,000. How much bad debt loss can Joe's Car Lot deduct on his tax return in 2022?
Group of answer choices
$6,000
$4,000
$12,000
$20,000
$0
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