Exercise 5-26B Recording estimates of future returns P6 Chico Company allows its customers to return merchandise within 30 days of purchase. At December 31, the end of its first year of operations, Chico estimates future-period merchandise returns of $60,000 (cost of $22,500) related to its current-year sales. A few days later, on January 3, a customer returns merchandise with a selling price of $2,000 for a cash cash refund; the returned merchandise cost $750 and is returned to inventory as it is not defective. a. Prepare the December 31 year-end adjusting journal entry for estimated future sales returns and allowances (revenue side). b. Prepare the December 31 year-end adjusting journal entry for estimated future inventory returns and allowances (cost side). c. Prepare the January 3 journal entries to record