A corporation uses the perpetual inventory system. On April 1, it purchased merchandise on account for $15,000 with terms 1/15, n/30. It returns merchandise with an invoice price of $1,000 to the seller on April 7. On April 10, it pays for the merchandise it retains. How would it record its return of merchandise on April 7?

Debit accounts payable for $1,000; credit purchase returns and allowances for $1,000. Debit accounts payable for $1,000; credit inventory for $1,000. Debit accounts payable for $990; credit inventory for $990. Debit accounts payable for $990; credit purchase returns and allowances for $990. Debit purchase returns and allowances for $1,000; credit inventory for $1,000