Emma Co sold Isabella Co merchandise on account FOB shipping point, 2/10, net 30, for $25,000. Emma Co prepaid the $500 shipping charge. Using the perpetual inventory method, which of the following entries will Isabella Co make if Isabella Co pays within the discount period?
A) Accounts Payable-Emma Co., debit $25,000; Freight In, credit $500; Cash, credit $24,500
B) Accounts Payable-Emma Co., debit $25,500; Merchandise Inventory, credit $500; Cash, credit $25,000
C) Accounts Payable-Emma Co., debit $25,000; Freight In, debit $500; Cash, credit $25,500
D) Accounts Payable-Emma Co., debit $25,500; Merchandise Inventory, debit $500; Cash, credit $26,000
B
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