A deduction allowed from the invoice price of goods if payment is

made within a specified period of time is called a trade discount.

True
False

6-6. Merchandise with a list price of $100, subject to a trade discount

of 40 percent and sold with credit terms of 2/10, n/60, would cost the
buyer $58.80 if payment is made within the discount period.

True
False

6-7. When goods are shipped under freight terms of FOB shipping
point (FOB factory), the buyer of the goods pays the freight charges.

True
False

6-8. When a return of merchandise requires the buyer to notify the

seller of the reduction in the invoice due to the return, the
memorandum sent by the buyer is called a debit memorandum.

True
False

6-9. The cost of goods sold is determined by adding the cost of

purchases to the beginning merchandise inventory and subtracting
the ending merchandise inventory.

True
False

6-10. An income statement in which the details of the cost of goods

sold are shown is called a single-step income statement.

True
False