Call custom template in CMS page

Question

I would like to know how I can display custom code in a CMS page. When using static blocks I can use the following code:

{{block type="cms/block" block_id="customcode"}}

I guess it has to be something like this:

{{block type="core/template" template="custom/code.phtml"}}

Does it work like that? Where do I put the file custom/code.phtml?