3. MC.o6-100 When purchases of merchandise are made on account with a perpetual inventory system, the transaeion is rerorded with which entry? debit Merchandise Inventory; credit Purchases debit Merchandise Inventory: credit Cash Discounts debit Accounts Payable; credit Merchandise Inventory debit Merchandise Inventory; credit Accounts Payable 4. MC.06-114 Emma Co. sold to Isabella Co. merchandise on account FOB shipping point, 2/10, net 30, for $15,000. Emma Co. prepaid the $750 shipping charge. Using the perpetual inventory method, which of the following entries will Isabella Co. make to record payment of the merchandise if Isabella Co. pays within the discount period? a. Accounts Payable-Emma Co., debit $15,750; Merchandise Inventory b. Accounts Payable-Emma Co, debit $15,450; Cash, credit $15,450 c. Accounts Payable-Emma Co., debit $15,000; Freight In, debit $750; Cash, credit $15,750 d. Accounts Payable-Emma Co., debit $15,000; Cash, credit $15,000 , debit $300, Cash, credit $16,050 MC.07-92 If the revenues are correctly reported and the gross profit of a company is understated, what is the effect on owner's 5. equity? correctly stated