On March 12, Klein Company sold merchandise in the amount of $7,800 to Babson Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,500. Klein uses the perpetual inventory system. On March 15, Babson returns some of the merchandise. The selling price of the merchandise is $600 and the cost of the merchandise returned is $350. Babson pays the invoice on March 20, and takes the appropriate discount. The journal entry that Klein makes on March 20 is:

Debit Cash 7,644; Debit Sales discounts 156; Credit Accounts receivable 7,800

Debit Cash 7,056; Credit Accounts receivable 7,056

Debit Cash 4,500; Credit Accounts receivable 4,500

Debit Cash 7,056; Debit Sales discounts 144; Credit Accounts receivable 7,200

Debit Cash 7,800; Credit Accounts receivable 7,800