To promote the sale of some specialty goods, Ropers Ltd. began a generous return policy for its customers. Customers can return merchandise for up to three months following the date of the invoice, no questions asked. For the current period, sales of these specialty goods totalled $40,000. Ropers chooses to estimate any expected sales returns at the end of each reporting period, rather than recording the Refund Liability at the point of sale. At the end of the reporting period, Ropers estimates that outstanding returns will be $3,500. Assuming Ropers follows IFRS, prepare the required adjusting journal entry at the end of the reporting period. Ignore any inventory cost.