Using T accounts for Cash, Accounts Payable, Purchases, Purchases Returns and Allowances, Purchases Discounts, and Freight-In, enter the following purchase transactions. Identify each transaction with its corresponding letter.

3. Purchase of merchandise on account with return of merchandise.

Merchandise is purchased on account, credit terms 2/10, n/30, $4,500. (A)

Merchandise is returned for credit before payment is made, $500. (B)

Payment is made within the discount period. (C)