On October 2, 2020, Pina Company sold $6,270 of its elite camping gear (with a cost of $3,240) to Lynch Outfitters. As part of the sales agreement, Pina includes a provision that if Lynch is dissatisfied with the product, Pina 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 Pina and Lynch). Pina expects total allowances to Lynch to be $830. On October 16, 2020, Pina grants an allowance of $410 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 Pina to record (1) the sale on October 2, 2020, (2) the granting of the allowance on October 16, 2020, and, (3) any adjusting required on October 31, 2020 (when Pina prepares financial statements). Pina 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 0 for the amounts.)

No	Account Titles and Explanation	Debit	Credit
(1)
	(To record sales on account)
	(To record cost of goods sold)
(2)
	(To record allowance)
(3)
	(To record estimated remaining allowances)

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List of Accounts

Indicate the income statement and balance sheet reporting by Pina at October 31, 2020, of the information related to the Lynch transaction.

Income Statement (partial) October 31, 2020For the Quarter Ended October 31, 2020
Accounts receivableSales returns and allowancesAccounts payableSales revenueInterest expensesCost of goods sold		$
AddLess: Cost of goods soldSales revenueInterest expensesAccounts receivableAccounts payableSales returns and allowances
Dividends DeclaredExpensesGross profitNet Income / (Loss)Net Income to Retained EarningsNet SalesRetained Earnings 11/1Retained Earnings 10/31RevenuesTotal Cost & ExpensesTotal Revenues
Cost of goods soldInterest expensesSales returns and allowancesAccounts receivableSales revenueAccounts payable
Dividends DeclaredExpensesGross profitNet Income / (Loss)Net Income to Retained EarningsNet SalesRetained Earnings 11/1Retained Earnings 10/31RevenuesTotal Cost & ExpensesTotal Revenues		$

Balance Sheet (partial) October 31, 2020For the Year Ended October 31, 2020For the Quarter Ended October 31, 2020
Interest expensesAccounts payableSales returns and allowancesSales revenueCost of goods soldAccounts receivable		$
AddLess: Sales revenueAccounts receivableCost of goods soldAllowance for Sales returns and allowancesInterest expensesAccounts payable
Interest expensesSales returns and allowancesCost of goods soldSales revenueAccounts receivable (net)Accounts payable		$