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Recording Estimated Returns

Fizer recognized sales of $900,000 in 2020 on merchandise with a cost of $468,000. Actual sales returns in 2020 were $5,040. Based on historical trends, the company estimates returns to be 1.5% of sales. Assuming all sales are on account, record the adjusting entry for estimated sales returns on December 31, 2020.

Note: Round your answers to the nearest whole number.

Date	Account Name	Dr.	Cr.
Dec. 31	CashAccounts ReceivableAllowance for Doubtful AccountsInterest ReceivableInventoryInventoryEstimated ReturnsRefund LiabilitySales RevenueSales ReturnsSales DiscountSales Discount ForfeitedCost of Goods SoldBad Debt ExpenseN/A
	CashAccounts ReceivableAllowance for Doubtful AccountsInterest ReceivableInventoryInventoryEstimated ReturnsRefund LiabilitySales RevenueSales ReturnsSales DiscountSales Discount ForfeitedCost of Goods SoldBad Debt ExpenseN/A
	To record estimated returns
Dec. 31	CashAccounts ReceivableAllowance for Doubtful AccountsInterest ReceivableInventoryInventoryEstimated ReturnsRefund LiabilitySales RevenueSales ReturnsSales DiscountSales Discount ForfeitedCost of Goods SoldBad Debt ExpenseN/A
	CashAccounts ReceivableAllowance for Doubtful AccountsInterest ReceivableInventoryInventoryEstimated ReturnsRefund LiabilitySales RevenueSales ReturnsSales DiscountSales Discount ForfeitedCost of Goods SoldBad Debt ExpenseN/A
	To record estimated returns

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