Exercise 18-18 On October 2, 2017, Headland Company sold $6,310 of its elite camping gear (with a cost of $3,360) to Lynch Outfitters on credit. As part of the sales agreement, Headland includes a provision that if Lynch is dissatisfied with the product, Headland will grant an allowance on the sales price or agree to take the product back (although returns are rare, given the long-term relationship between Headland and Lynch). Headland expects total allowances to Lynch to be $810. On October 16, 2017, Headland grants an allowance of $400 to Lynch because the color for some of the items delivered was a bit different than what appeared in the catalog Prepare journal entries for Headland to record (1) the sale on October 2, 2017, (2) the granting of the allowance on October 16, 2017, and, (3) any adjusting required on October 31, 2017 (when Headland prepares financial statements). Headland now estimates additional allowances of $250 will be granted to Lynch in the future. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.) No Account Titles and Explanation Debit Credit (To record sales) (To record cost of goods sold) (To record allowance) To record estimated remaining allowances)