On August 5, Michaels Ltd

On August 5, Michaels Ltd.sells goods for $1,500 and the cost to Michaels was $800.Michaels expects a return rate of 5%.On August 12, goods with a selling price of $400 and a cost of $215 are returned for credit and restored to inventory.The journal entry to record the return will include

A) credit to Estimated Inventory Returns for $215.
B) credit to Inventory for $215.
C) credit to Refund Liability for $400.
D) debit to Accounts Receivable for $400.