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Cody and Rio run a successful business that sells premium bird cages to retail stores. One client, St. Ink n Rich Inc., calls Cody and

Cody and Rio run a successful business that sells premium bird cages to retail stores. One client, St. Ink n Rich Inc., calls Cody and exclaims that a bird cage they purchased last week was the wrong colour. St. Ink n Rich Inc. says they will return the bird cage unless Cody offers them a 20% allowance on the cage. Cody agrees to the allowance. How does St. Ink n Rich Inc. record this allowance? Assume a perpetual inventory system.

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