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Bay Company began using the allowance method in 2014. On January 1, 2014, Bay had...

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Accounting

Bay Company began using the allowance method in 2014. On January 1, 2014, Bay had a $4,000 balance in the Accounts Receivable account and a zero balance in the Allowance for Doubtful Accounts account. During 2014, Bay provided $35,000 of service on account. The company collected $26,000 cash from account receivable. Uncollectible accounts are estimated to be 2% of sales on account. The amount of cash flow from operating activities that would appear on the 2014 statement of cash flows is:

$31,000.

$35,000.

$26,000.

$22,000.

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