accounting practice question.

ABC Manufacturing ("ABC") has a December 31, 2020 year-end. Tools returned by customers and held pending inspection in the returned goods are on December 31, 2020, were not included in the physical count. On January 2021, the tools costing $50,000 were inspected and returned to inventory. Credit memos totaling $63,000 were issued to the customers on the same date. At December 31, 2020, what adjustment(s), if any, should be made to ABC's books? Increase inventory by $50,000 and increase net sales by $63,000. Decrease inventory by $50,000 and decrease net sales by $63,000. Increase inventory by $50,000 and decrease net sales by $63,000 None of the above