James Company experienced the following events during its first accounting period:(1)Purchased $10,000 of inventory on account under terms 1/10 n/30.(2)Returned $2,000 of the inventory purchased in Event 1.(3)Paid the remaining balance in account payable for the inventory purchased in Event 1.Based on this information, which of the following shows how the recognition of the cash discount (Event 1)will affect the Company's financial statements?

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The Answer of James Company experienced the following events during its first accounting period:(1)Purchased $10,000 of inventory on account under terms 1/10 n/30.(2)Returned $2,000 of the inventory purchased in Event 1.(3)Paid the remaining balance in account payable for the inventory purchased in Event 1.Based on this information, which of the following shows how the recognition of the cash discount (Event 1)will affect the Company's financial statements?

James Company Experienced the Following Events During Its First Accounting