On October 2, 2017, Sheridan Company sold $5,510 of its elite camping gear (with a cost of $3,470) to Lynch Outfitters on credit. As part of the sales agreement, Sheridan includes a provision that if Lynch is dissatisfied with the product, Sheridan 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 Sheridan and Lynch). Sheridan expects total allowances to Lynch to be $770. On October 16, 2017, Sheridan grants an allowance of $390 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 Sheridan 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 Sheridan prepares financial statements). Sheridan now estimates additional allowances of $260 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 O for the amounts.)