Smith Company sold merchandise inventory on account to Justin's Jewelers. Smith Company grants a $$300$ sales allowance for damaged goods to Justin's. The journal entry to record a sales allowance in the books of Smith Company, using the perpetual inventory system and assuming an adjusting entry was made to record estimated sales returns would be:

A$.$ Estimated Returns Inventory

$300$

B$.$ Refunds Payable

$300$

C$.$ Cost of Goods Sold

$300$

D$.$ Refunds Payable

$300$

Accounts Receivable

$300$