supportengineer parent
All other factors being the same year to year, this accounting change will suddenly show the company making a sizable profit. Because the R&D cost (engineer salaries) can no longer be expensed.
Exactly. How we've thought about what 'profit' is has changed.
When I bought a laptop for my business, it was amortized over... 3 years I think. Kinda nuts but, whatever. It's a couple thousand dollars.
But the example above (somewhere) with the 5 employees at $200k/each... only being able to deduct $100k of that, even assuming $1m in revenue... meaning 'profit' of $900k.... it's just crazy.