On June 1, Neighbor Company Purchased Inventory on Account with a Cost

On June 1, Neighbor Company purchased inventory on account with a cost of $5000. The credit terms were 2/10, net 30. On June 2, Neighbor returned 60 percent of the inventory. Neighbor uses the perpetual inventory system. On June 8, Neighbor paid for the inventory. What journal entry did Neighbor Company prepare on June 8?

A) debit Purchase Discount for $40, debit Cash for $1960 and credit Accounts Payable for $2000
B) debit Accounts Payable for $3000 and credit Cash for $3000
C) debit Accounts Payable for $2000 credit Purchase Discount for $40 and credit Cash for $1960
D) debit Accounts Payable for $2000, credit Inventory for $40 and credit Cash for $1960