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The Data Presented Below Is for Falconi, Inc ? What Is the Effect on Liquidity When Falconi Records

question 14

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The data presented below is for Falconi, Inc.for 2016.  Credit sales during the year $2,100,000 Accounts receivable-December 31, 2016 395,000 Allowance for doubtful accounts-December 31,2016 20,000 Bad debt expense for the year 17,000\begin{array}{lr}\text { Credit sales during the year } & \$ 2,100,000 \\\text { Accounts receivable-December 31, 2016 } & 395,000 \\\text { Allowance for doubtful accounts-December 31,2016 } & 20,000 \\\text { Bad debt expense for the year } & 17,000\end{array} ? What is the effect on liquidity when Falconi records its estimate for bad debt expense using the allowance method?

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