How would a transaction of paid research and development expenses for the current year effect three element of accounting equation
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How would a transaction of paid research and development expenses for the current year effect three element of accounting equation
you paid cash, which means an asset (Cash) decreases and the cash was paid for an expense, which means that there is an increase in expenses.
Owners Equity = Net Income, so Revenues increase net income and expenses decrease owners equity, so your expenses for R&D will decrease Owners Equity.
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