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Jacob Co. bought $13,000 worth of inventory on account from Homer Co. on terms 3/10,...

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Accounting

Jacob Co. bought $13,000 worth of inventory on account from Homer Co. on terms 3/10, n/30. Jacob Co. pays the balance on June 10th, the last day of the discount period.

When Jacob Co., the buyer, makes journal entry to record the transaction on June 10th, what is the effect on the accounting equation?

Decrease Cash $12,610, decrease Inventory $390 and decrease Accounts Payable $13,000

Decrease Cash $13,000 and decrease Accounts Payable $13,000

Decrease Cash $12,610 and decrease Accounts Payable 12,610

Decrease Cash $12,740, decrease Inventory $260 and decrease Accounts Payable $13,000

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