Q/TV. Signify TRUE or FALSE for each of the following items as they pertain to accounting for merchandising operations. When a business records a sales return, cost of goods sold will be credited. a) FALSE 1. b) TRUE 2. When a business records a sales allowance, cost of goods sold will be credited. a) FALSE A sales discount should be recorded at the time of sale. a) FALSE b) TRUE 3. b) TRUE 4. A purchase discount should be recorded at the time of payment rather than at the time of purchase a) FALSE b) TRUE 5. Out-going freight costs are treated as operating expenses rather than being treated as part of cost of goods sold. a) FALSE b) TRUE 6. When a seller incurs out-going freight costs, then by default the buyer incurs in-coming freight costs for an equal amount a) FALSE b) TRUE Focus