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Waterway Company uses the percentage of receivables method for recording bad debt expense. The accounts receivable balance is $602000 and credit sales are $2680000. Management

Waterway Company uses the percentage of receivables method for recording bad debt expense. The accounts receivable balance is $602000 and credit sales are $2680000. Management estimates that 3% of accounts receivable will be uncollectible. What adjusting entry will Waterway Company make to record bad debt expense if the Allowance for Doubtful Accounts has a $5000 credit balance before adjustment?

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