In the Current Year,Borden Corporation Had Sales of $2,000,000 and Cost

Multiple Choice

In the current year,Borden Corporation had sales of $2,000,000 and cost of goods sold of $1,200,000.Borden expects returns in the following year to equal 8% of sales.The unadjusted balance in Inventory Returns Estimated is a debit of $6,000,and the unadjusted balance in Sales Refund Payable is a credit of $10,000.The adjusting entry or entries to record the expected sales returns is (are) :

A) $\begin{array}{|l|l|l|}\hline \text { Accounts Receivable } & 2,000,000 & \\\hline \text { Sales } & & 2,000,000 \\\hline\end{array}$
B) $\begin{array}{|l|r|r|}\hline \text { Sales returns and allowances } & 150,000 & \\\hline \text { Sales } & & 150,000 \\\hline \text { Cost of Goods Sold } & 90,000 & \\\hline \text { Inventory Returns Estimated } & & 90,000 \\\hline\end{array}$
C) $\begin{array}{|l|r|r|}\hline \text { Sales } & 2,000,000 & \\\hline \text { Sales Refund Payable } & & 160,000 \\\hline \text { Accounts receivable } & & 1,840,000 \\\hline\end{array}$
D) $$\begin{array} { | l | l | l | } \hline \text { Sales Refurd Payable } & 150,0000 & \\\hline \text { Accourits receivable } & & 150,000 \\\hline\end{array}$$
E) $\begin{array}{|l|r|r|}\hline \text { Sales Returns and Allowances } & 150,000 & \\\hline \text { Sales Refund Payable } & & 150,000 \\\hline \text { Inventory Returns Estimated } & 90,000 & \\\hline \text { Cost of goods sold } & & 90,000 \\\hline\end{array}$