Procter & Gamble Data for the year ended December 31, 2023:

Item	Amount
Research and Development Costs	$3,000,000
Estimated Future Benefits	$2,200,000
Sales	$10,000,000
Cost of Goods Sold	$6,000,000
Operating Expenses	$2,500,000

1. Determine how much of the R&D costs should be expensed.
2. Calculate the impact on net income if all R&D costs are expensed.
3. Discuss how expensing R&D costs affects Procter & Gamble’s net profit margin.
4. Explain the rationale for expensing R&D costs under the Conservatism Principle.
5. How should the company record the R&D expenses in its financial statements?