(TCOs A and B) LBJ Company recorded the following events involving a recent merchandise purchase.

- Received goods for $40,000, terms 2/10, n/30
- Returned $1,200 of the shipment for credit due to damaged goods
- Paid $1,000 for freight in
- Paid the invoice within the discount period

As a result of these events, the company's merchandise inventory (Points : 3)

increased by $39,800.
increased by $39,024.
increased by $38,988.
increased by $39,000.

show work