Waterway Industries had a 1/1/20 balance in the Allowance for Doubtful Accounts of $30500. During 2020, it wrote off $21000 of accounts and collected $6000 on accounts previously written off. The balance in Accounts Receivable was $580000 at 1/1 and $730000 at 12/31. At 12/31/20, Waterway estimates that 7% of accounts receivable will prove to be uncollectible. What is Bad Debt Expense for 2020?

$20600.

$41600.

$36500.

$35600.