On November 1, a company purchased inventory costing $1,000 on account. The payment terms are 2/10, n30. The company paid on November 6 to receive the 2% discount. What is the impact on the companys financial statements of the cash payment of this account within the discount period?

1. Increase liability by $1500

2. Decrease cash by $1000

3. Decrease inventory by $20

4. Increase inventory by $20