A computer company has $2800000 in research and development costs. Before accounting for these costs the net income of the company is $2000000. What is the amount of net income or loss after these R & D costs are accounted for?
A) $800000 loss
B) $2000000 net income
C) $0
D) Cannot be determined from the information provided.

Question

Quizplus · Accepted Answer

The R&D costs need to be deducted from the net income to get the new net income after accounting for these costs. $2000000 (original net income) - $2800000 (R&D costs) = -$800000, which means the company has a net loss of $800000 after accounting for R&D costs. Therefore, the correct answer is (A) $800000 loss.

A Computer Company Has $2800000 in Research and Development Costs