A pharmaceutical company spends $9m, $12m and $6m on research & development in 2018,2019 and 2020, respectively. Assume that these R&D expenditures were inappropriately capitalized and mortised over the next 3 years, beginning in the year after they were recognized. Which of the following items is understated for the 2020 fiscal vear?

a. Net income b. Retained earnings C. Total assets D. Total expenses