Question: 5. At June 30, 2016, before any adjustments for errors and other year-end adjusting entries, a company's allowance for bad debts was a credit

5. At June 30, 2016, before any adjustments for errors and other

5. At June 30, 2016, before any adjustments for errors and other year-end adjusting entries, a company's allowance for bad debts was a credit balance of $39,000. Accounts receivables totalled $517,000 as at June 30, 2016. As part of year-end adjusting entries, the company adjusts the allowance for bad debts to the equivalent of 8% of the accounts receivables based on past trends. Assume that for the year ended June 30, 2016, the company forgot to write off $5,000 accounts receivables because of an error made by the firm's accountant. After correcting this error and making any other necessary year-end adjustments, what number should appear in the income statement for the year ended June 30, 2016 as bad debts expense?

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