Cassidy Company uses a perpetual inventory system. On October 1, Cassidy Company sold inventory in the amount of $6,500 to Gelman Company, terms 2/10, n/30. The items cost Cassidy $4,200. On October 4, Gelman returns some of the inventory. This inventory had a selling price of $500 and a cost of $200. On October 8, Gelman Company paid Cassidy Company the amount due on that date. What journal entry will be prepared by Cassidy Company on October 8 to record the receipt of payment from Gelman?

a) Debit Cash and credit Accounts Receivable for $6,500 b) Debit Cash for $6,300, debit Sales Returns & Allowances for $200, and credit Accounts Receivable for $6,500 c) Debit Cash for $6,370, debit Sales Discount for $130, and credit Accounts Receivable for $6,500 d) Debit Cash for $5,880, debit Sales Discount for $120, and credit Accounts Receivable for $6,000