Darlington Company entered into the following business events during its first month of operations. The company uses the perpetual inventory system. 1) The company purchased $13,700 of merchandise on account under terms 3/10, n/30. 2) The company returned $3200 of merchandise to the supplier before payment was made. 3) The liability was paid within the discount period. 4) All of the merchandise purchased was sold for $21,400 cash. What effect will the return of merchandise to the supplier in event (2) have on Darlington's financial statements? Assets and liabilities decrease by $3200. Assets and stockholders' equity decrease by $3200. Assets and liabilities decrease by $3104. None. It is an asset exchange transaction.