ABC Mart received a $20 freight bill for merchandise it purchased with freight terms of FOB shipping point. ABC Mart uses a perpetual inventory system. Assuming it paid the bill immediately, demonstrate the journal entry required to record the freight charges.

Debit Transportation In $20; credit Cash $20.

Debit Merchandise Inventory $20; credit Cash $20.

Debit Freight In $20; credit Cash $20.

Debit Freight In $20; credit Merchandise Inventory $20