On March 10,2020 , Kingbird Company sold to Barr Hardware 220 tool sets at a price of $55 each (cost $29 per set) with terms of n/60, f.o.b. shipping point. Kingbird allows Barr to return any unused tool sets within 60 days of purchase. Kingbird estimates that (1) 10 sets will be returned, (2) the cost of recovering the products will be immaterial, and (3) the returned tools sets can be resold at a profit. On March 25, 2020, Barr returned 7 tool sets and received a credit to its account. No. Account Titles and Explanation Debit Credit (1) Accounts Receivable 12100 Sales Revenue 12100 (To record sales) Cost of Goods Sold 6380 Inventory (To record cost of goods sold) (2) Sales Returns and Allowances 385 Accounts Receivable (To record sales returns) Returned Inventory 203 Cost of Goods Sold (To record cost of goods returned) (3) Sales Returns and Allowances Allowance for Sales Returns and Allowances (Adjusting entry for sales returns) Estimated Inventory Returns Cost of Goods Sold (Adjusting entry for cost of goods sold) eTextbook and Media Assistance Used