31.Sellers and buyers are required to record trade discounts.
a.True
b.False
32.If the ownership of merchandise passes to the buyer when the seller delivers the merchandise for shipment, theterms are stated as FOB destination.
a.True
b.False
33.A sale of $750 on account, subject to a sales tax of 6%, would be recorded as an account receivable of $750.
a.True
b.False
34.When merchandise is sold for $600 plus 6% sales tax, the Sales account should be credited for $636.
a.True
b.False
35.The abbreviation FOB stands for "free on board."
a.True
b.False
36.Merchandise is sold for $3,600, terms FOB destination, 2/10, n/30, with prepaid freight costs of $150. The salesamount recorded is $3,528.
a.True
b.False
37.If the buyer bears the freight costs related to a purchase, the terms are said to be FOB destination.
a.True
b.False
38.When the terms of sale are FOB shipping point, the buyer pays the freight charges.
a.True
b.False
39.If merchandise costing $3,500, terms FOB destination, 2/10, n/30, with prepaid freight costs of $125, is paid within10 days, the amount of the purchases discount is $70.
a.True
b.False
40.The chart of accounts for a merchandising business would include an account called Delivery Expense.
a.True
b.False