TRUE OR FALSE WITH EXPLAINATION 8. Under the periodic inventory system, it is extremely important for a company to keep detailed records of goods on hand in real-time to determine the cost of goods sold. 9. Under the Periodic System, a physical inventory is taken in order to determine the inventory on hand and the cost of goods sold for the period. 10. The cost of goods sold is the total expense (cost) a company incurs during an accounting period. 11. In a multiple-step income statement, cost of goods sold is added to the net sales to get the gross profit. 12. Sales returns and allowances is a contra revenue account to Sales Revenue with a normal credit balance. 13. The ending inventory was $2,500, the cost of goods sold is $5,900. If there were no beginning inventory, the amount of inventory purchased during this accounting period was $3,400. 14. Under FOB Destination, the ownership of the goods remains with the seller until the goods reach the buyer.