I'm not to sure about myself, I know I did it wrong but it had the same end result that it was supposed to have. The directions said and I quote:
-Cut a 7 1/4"x7 1/4" sq. from white freezer paper.
-Place it on the pumpkin pattern and trace the image.
-Cut the inside of the image out and press the shiney side of the freezer paper to the WRONG side of a 7 1/4" x 7 1/4" background fabric.
-CAREFUL NOW! You will now cut away the inside image of your fabric but you must add a 3/16 seam allowance to the INSIDE of this image of your background fabric.