A Company That Uses the Perpetual Inventory Method Purchases Inventory

Multiple Choice

A company that uses the perpetual inventory method purchases inventory for $2,000 from a vendor on account,FOB shipping point,with terms of 2/10,n/30.The company paid the shipper $100 cash for freight in.
-Which of the following entries would be made to record payment to the vendor if the payment is made within 10 days?

A) $1,960 debit to Accounts payable and a $1,960 credit to Cash
B) $2,000 debit to Accounts payable, a $100 debit to Inventory and a $1,960 credit to Cash
C) $2,000 debit to Accounts payable, a $40 credit to Inventory and a $1,960 credit to Cash
D) $1,960 debit to Accounts payable, a $40 debit to Inventory and a $2,000 credit to Cash