Avery Supplies Uses a Periodic Inventory System B) C) D) $$\begin{array} { | c | r | r | } \hline \text { Accounts Payable } & 400 & \\\hline \text { Cash } & & 400 \\\hline\end{array}$$

Avery Supplies uses a periodic inventory system. Avery purchased $10,000 of inventory on account. The terms were 3/10, n/30. The purchase was made on February 1. On February 2, Avery returned $400 of damaged goods to the supplier and was granted an allowance. How should Avery properly record the allowance?

A) $$\begin{array} { | r | r | r | } \hline \text { Accounts Payable } & 400 & \\\hline \text { Purchase Returns and Allowances } & & 400 \\\hline\end{array}$$
B) $\begin{array}{|l|l|cc|} \hline \text {Accounts Payable \quad\quad\quad\quad } & \text { \quad\quad9,600 } & \text { }\\\hline \text { Purchase Discounts } & \text {\quad\quad\quad\quad400 } & \text { }\\\hline \text { Purchases } & \text { } & \text { \quad\quad\quad10,000 }\\ \hline\end{array}$

C) $$\begin{array} { | c | r | r | } \hline \text { Accounts Payable } & 10,000 & \\\hline \text { Cash } & & 9,600 \\\hline \text { Purchase Returns and Allowances } & & 400 \\\hline\end{array}$$
D) $$\begin{array} { | c | r | r | } \hline \text { Accounts Payable } & 400 & \\\hline \text { Cash } & & 400 \\\hline\end{array}$$