Halifax Manufacturing allows its customers to return merchandise for any reason up to 90 days after delivery and receive a credit to their accounts. All of Halifax's sales are for credit (no cash is collected at the time of sale). The company began 2021 with a refund liability of $300,000. During 2021, Halifax sold merchandise on account for $11,500,000. Halifax's merchandise costs is 65% of merchandise selling price. Also during the year, customers returned $450,000 in sales for credit, with $250,000 of those being returns of merchandise sold prior to 2021, and the rest being merchandise sold during 2021. Sales returns, estimated to be 4% of sales, are recorded as an adjusting entry at the end of the year. Required: 1. Prepare entries to (a) record actual returns in 2021 of merchandise that was sold prior to 2021; (b) record actual returns in 2021 of merchandise that was sold during 2021; and (c) adjust the refund liability to its appropriate balance at year end. 2. What is the amount of the year-end refund liability after the adjusting entry is recorded? Required 1 Required 2 Prepare entries to (a) record actual returns in 2021 of merchandise that was sold prior to 2021; (b) record actual returns in 2021 of merchandise that was sold during 2021; and (c) adjust the refund liability to its appropriate balance at year end. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No 1 Year 2021 General Journal Allowance for uncollectible accounts Accounts receivable 2 2021 Inventory Cost of goods sold 3 2021 Sales returns Accounts receivable 4 2021 Inventory 10 5 2021 6 2021 Cost of goods sold Sales returns Allowance for uncollectible accounts Inventory-estimated returns Cost of goods sold 30 00 Required 1 Required 2 > Debit 250,000 Credit 250,000 162,500 162,500 200,000 200,000 130,000 130,000 ( 410,000 410,000 266,500 266,500 Required 11 Required 2 What is the amount of the year-end refund liability after the adjusting entry is recorded? Ending balance in refund liability 460,000 < Required 1 Required 2 >