For calendar 2012, a pharmaceutical company has $2,500,000 in research costs. Before accounting for these costs, the profit of the company is $2,200,000. Ignoring taxes, what is the amount of profit or loss after these research costs are accounted for?

Question

Quizplus · Accepted Answer

The company had a profit of $2,200,000 before accounting for research costs, but the research costs decreased the profit by $2,500,000. Therefore, the company experienced a loss of $300,000 ($2,200,000 - $2,500,000 = -$300,000) after accounting for these costs. Therefore, the correct choice is (C) $300,000 loss.

For Calendar 2012, a Pharmaceutical Company Has $2,500,000 in Research