Record the estimated refund liability for June. The refund liability for the month was estimated to be 5 percent of the gross sales for the month. The cost of goods estimated to be returned was $560. Begin by recording the estimated refund liability for the month.

Fitness Equipment Doctor, Inc. Unadjusted Trial Balance June 30, 2018 Account Debit Credit Cash 15,916 Accounts receivable 2,200 Inventory 16,465 Supplies 675 Prepaid rent 4,800 Land 16,000 Furniture 3,700 Accumulated depreciation, furniture 115 Equipment 7,260 Accumulated depreciation, equipment 450 Vehicles 35,800 Accumulated depreciation, vehicles 1,200 Accounts payable 4,660 Estimated refund liability 297 Unearned service revenue 2,900 Notes payable 35,800 Common stock 45,000 Retained earnings 7,020 Sales revenue 20,173 Service revenue 865 Cost of goods sold 11,250 Advertising expense 565 Salaries expense 675 Delivery expense 435 Utilities expense 385 Commission expense 1,760 S 118.183 | S 118.183