1. Operating expenses include cost of goods sold. A) True B) False 2. For a merchandising company, the difference between net sales and operating expensesi. called gross margin. A) True B) False 3. Sales Returns and Allowances is described as a contra-revenue account. A) True B) False 4. Freight Out Expense is included in the cost of goods sold calculation. A) True B) False 5. General and administrative expenses are a category of operating expense. A) True B). False 6. Freight In is considered a cost of merchandise purchased. A) True " B) False 7. The difference between gross sales and net sales is equal to the sum of sales disce sales returns and allowances. A) True B) False 8. FOB shipping point means that the seller incurs the shipping costs. A) True B) False 9. Sales Discounts is a contra-revenue account with a normal credit balance. A) True B) False 10. Purchases Discounts would be recorded as a credit. A) True B) False Use the following to answer questions 11-14